The story: After a rare exchange of fire targeted at respective Baluch separatists—in parallel with a heated diplomatic spat—Iran and Pakistan have agreed to restore ambassadors. The development highlights the mutual desire on both sides to avoid further escalation. Both Islamabad and Tehran face domestic economic and political woes ahead of upcoming general polls. This is taking place in the shadow of rising regional tensions over the Gaza war.

The coverage: In a joint statement issued on Nov. 22, Iran and Pakistan said it had been “mutually agreed” that respective ambassadors may return to their respective posts by Jan. 26. The decision was made in a...