Khushvad plays has an important role in Pengia Terrum, being a key party and founder of the Pengia Terrum Council of Co-Operation, which sees Khushvad on good terms with neighbours. The closest allies of Khushvad are its immediate neighbours, Garahe ko and Aldrest. Khushvad shares a long standing, traditional friendship with these two countries which is reflected in all spheres of life. The two countries are key trade partners for Khushvad and cultural influences extends from Khushvad into these two countries and vice versa. There is often a lot of co-operation with Khushvad and these countries in many fields but sport matches between either country are one of the biggest events for Khushvad.
Khushvad also enjoys vibrantly cordial relations with Skhaggerstan and Frogalicious. Intergovernmental co-operation with these countries are strong and positive. Relations with Metaphysicus and Crackhead Hawaii are also warm. The Liberal Party and New Democratic Party support stronger relations with Crackhead Hawaii, with the New Democratic Party favouring Crackhead Hawaii over Skhaggerstan, both believing that it would be an asset for the country's economy and people. Meanwhile, Metaphysicans are famous in Khushvad for their extensively philosophical nature and outlook of life which stems from experiences of visits by Metaphysicans to Khushvad. A particular event that stands out was the vist of Empedocles (a member of Metaphysicus's prestigious Stoics) who questioned the necessity of a government, sparking intense debate throughout Khushvad. However, people among the Musashi tribe of Metaphysicus have often shown disapproval of Khushvad.
Generally, Khushvad has a friendly approach to foreign relations. Khushvad actively pursues good relations with countries and has in its modern history (as the Republic of Khushvad) never started a war. A satirist from Bigtopia once joked, 'I wonder what Khushvad would do in a war, because they seem to see everyone as their friends!'.