It's serious in terms of the decision that Pakistani cinema shut down Indian movie, even if they expect less customers to come to their cinemas. Cultural disruption in addition to political confrontation would make relationship between them worse than what it is.
Kashmir is now divided and administrated by India, China, and Pakistan. And, it's also divided by Buddhists(Tibetan Buddhism), Hinduists ,and Muslims. So, it's the border of three cultures.
It will be difficult to solve the territorial dispute between three countries.(If you include Republic of China, it's confrontation between 4 countries)