How would this impact the conflict
The conflict still ends with an inconclusive result, but rather than OTL where both sides claimed victory, I imagine India would not be able to do so.
It's very hard for Pakistan to win against India. This is for a simple reason: India is much larger than Pakistan, and much of Pakistan's population was Bengali and therefore second-class citizens (no fans of the government which treated them like a colony). Therefore, India just had more men.
What would be the impact on the subcontinent
Massive anti-Western sentiments to a degree which never existed OTL; IOTL, while the US supported Pakistan in 1971, India's sweeping victory over Pakistan as well as stopping the inhuman brutality of the Bangladesh Genocide put the US issue on the backburner, though it didn't stop India from formalizing an alliance of convenience with the USSR. ITTL, India will be pushed more firmly into the Soviet camp, though it will still be a weak alliance.