Skardu Valley, view from our hotel. At 2438m above sea level, Skardu is the capital of Baltistan. Baltistan is a region in the far north of Kashmir, bordering the Chinese region of Xinjiang. It is situated in the Karakoram mountains just to the south of K2, the world's second highest mountain. It is an extremely mountainous region, with an average altitude of over 3350m and is the source of the Indus river. It is inhabited principally by Balti Muslims of Tibetan descent.