The Indus Water Treaty

13. The Indus flows through the north-west of India and Pakistan. It arises within Tibet from a holy lake called Mansarovar, the mouth of the lion. After rising in Tibet, the Indus runs north-west between the Karakoram and the Himalayas. In Kashmir, the river crosses the Line of Control (LoC) and enters Baltistan. The principal tributaries of the Indus in the west are Kabul and Khurram rivers, while its five main tributaries in the East are the Jhelum, Chenab, Ravi, Sutlej and Beas rivers.

INDUS BASIN RIVERS

14. The British laid the foundation of the Indus Basin River System in the late 19th Century. The system did exist prior to the British annexation of the area but in a rudimentary form. The irrigation network constructed during the British rule, especially after 1885, was based on perennial canals which led off from river-spanning weirs and head works. Vast areas which had remained inaccessible under the traditional irrigation system were brought under cultivation by this canal system. In the Punjab, two major systems of irrigation were developed–Bari Doab and the Sutlej Valley Project.

15. In the 19th century, the British constructed most of what is today the world’s largest contiguous irrigation system in the Indus Basin. However, the boundaries between the two states drawn in 1947 paid no attention to hydrology. Eighty per cent of the irrigated area was in Pakistan, but after Partition a large portion of the headwaters for the rivers which serviced most of this immense area were in Indian-held Kashmir.

16. Seeing that India and Pakistan were unable to resolve this issue, the World Bank offered its help. After 10 years of intense negotiation, in 1960 the IWT was signed by then Indian Prime Minister Jawaharlal Nehru, Pakistani President Ayub Khan and the World Bank.

17. Originally designed as one scheme [] , however, with the partition of the subcontinent in 1947, including the province of Punjab, the Indus system was also divided; while the head works fell to India, the canals ran through Pakistan. With a view to attaining the most complete and satisfactory utilization of the waters of the Indus basin and recognizing the need for fixing and delimiting the rights and obligations of each country in relation to the other , both states, as part of the Indus Waters Treaty agreed to following provisions of the treaty:-

Essential Provisions [] of the Treaty

18. There are four essential elements to the treaty (Articles of treaty attached as appendices). The first relates to the division of the waters. The waters of the three western rivers (the Indus, the Jhelum and the Chenab) were allocated to Pakistan, and the waters of the three eastern rivers (the Ravi, the Beas and the Sutlej) were allocated to India.

19. The second was a financing plan to assist Pakistan in building the vast “replacement works” (Tarbela Dam on the Indus and Mangla on the Jhelum in Pakistan-held Kashmir and the massive link canals) which were needed to store and transport water from rivers in the west to the irrigated areas of Pakistan. India contributed about 20% of the almost $1 billion (in 1960 dollars) required.

20. The third element relates to use of the hydroelectric potential of “Pakistan’s rivers” before they reach Pakistan. This was a major bone of contention in the negotiations. India had a legitimate desire to harness the hydroelectric potential of “Pakistan’s rivers” before the rivers reached the Line of Control. Pakistan was well aware that the

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backbone of its economy was irrigated agriculture that was built around the natural flows of the rivers, and thus worried that its security would be seriously compromised if India built dams which could alter the timing of water coming to Pakistan, especially from the Jhelum and the Chenab. The compromise reached in the IWT was that India could use the hydro potential on the rivers, but that there would be restrictions on the manipulable storage that India could construct on these rivers, thus eliminating the possibility of the dams being operated in a way that would adversely affect Pakistan.

21. The fourth element of the treaty is the dispute resolution mechanism, which sets up rules whereby first recourse is for the Indian and Pakistani IWT commissioners to resolve potential problems. If this fails then there are provisions for external arbitration, either through a neutral expert appointed by the World Bank, or through an international court of arbitration.

Treaty as Success Story

22. The treaty is widely described as the only institutional mechanism that has worked between India and Pakistan over the past 50 years. In part this is because of the intelligent design of the treaty, but it is also true that it “worked” because for decades India did very little to develop the hydropower resources on the Jhelum and the Chenab in Indian-held Kashmir.

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Effects of the Treaty

23. Positive Aspects for Pakistan. The treaty assured [] Pakistan, permanent water supply for its canal system. The principal benefits were:-

(a) It helped Pakistan gain independence from India for ensuring its supplies by binding India to a formal international treaty.

(b) The treaty helped regulate the flows of the Indus and its tributaries. About 80 percent of the total water is produced during the monsoon period – July to September. Storage projects undertaken due to the treaty ensure water availability during winters and enhanced canal diversions.

(c) It helped to revolutionize the agricultural sector.

24. Negative Aspects for Pakistan. The negative outcome for Pakistan was the loss of eastern rivers and with this, land surrounding these rivers largely irrigated by traditional methods was adversely affected. However, this loss was compensated by the construction of storage reservoirs, canals and diversions. The other drawback was the rise in inter-provincial discord, especially in recent years, due to reduced flow in the Indus.

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25. Positive Aspects for India. The major benefits that accrued from the treaty to India were :-

(a) The treaty enabled India to harness the eastern rivers to its benefit. It helped in diverting waters to arid areas like Rajasthan and develop irrigation facilities.

(b) India could also build run-of-the-river hydroelectric plants on the western rivers and flood control storage facilities, though no storage facilities have been built so far.

26. Negative Aspects for India. The losses to India were :-

(a) Ceding western rivers to Pakistan hampered growth of Jammu & Kashmir, as water resources in the state could not be harnessed.

(b) Increased differences amongst basin states as they began contending higher allocation of water.

(c) Absence of an exit clause in the treaty shut India’s options, though Article XII of the treaty provides for a modification of the treaty.

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Resolution of Salal Dam Controversy

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27. After the signing of Indus Waters Treaty, the first dispute India and Pakistan were engaged in was over the construction of the Salal Dam by India on the Chenab River. Under the terms of the Treaty, India submitted its plan to the Permanent Indus Commission for Pakistan’s approval in 1968. A run of- the-river [] hydroelectric project, Salal was deemed crucial for the agricultural needs of the Indian Punjab and economic progress of the country. In 1974 Pakistan officially objected to the design of Salal project arguing that it did not confirm to the criteria for design of such hydroelectric projects laid down under the Treaty.

28. During the course of the negotiations, several options were discussed for reaching to a final settlement including resort to the arbitration procedure provided in the Treaty. Finally, India agreed to make some changes in the design of the dam including reducing

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the height of the dam and to the permanent closure of the diversion canal after the hydel plant had been commissioned.

29. The resolution of this dispute was hailed in both countries and is still quoted as a case of successful diplomacy over water sharing between Pakistan and India due to the concessions made under the Salal Agreement signed in April 1978.

Challenges to the Treaty

“Although the Indus Rivers support the world’s largest irrigation system, the unused waters of the rivers, which now go to waste into the Arabian Sea, have an equally large useful potential. These could reclaim from the desert an area equal to that already developed. Another 26 million acres could be turned into smiling fields of wheat and rice and cotton – food for hungry and work for the unemployed”

[Shivananda, 1961: 4-5, emphasis added]

30. Over the last decade this situation has changed dramatically. India has initiated a major programme of hydropower development across its Himalayan region. As part of this strategy, and in part to try to address the grievances of the Kashmiri people, India has constructed and is constructing and planning a large number of large hydropower projects on the headwaters of “Pakistan’s rivers” (the Indus and especially the Jhelum and Chenab) in Indian-held Kashmir.

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31. Almost all the disputes over water that have arisen between India and Pakistan are about dam projects constructed or being constructed by one of the two parties. The negotiations over these issues involve divergent concerns and interests, based on their interpretations of the Indus Water Treaty. Under this unprecedented pressure, the IWT is creaking. The Indian perspective is that Pakistan uses the treaty to put an unending set of obstacles in India’s path. The Pakistani perspective is that New Delhi operates with impunity, and that the cumulative upstream water storage being created by India constitutes an existential threat to Pakistan’s security. The major disputes have been over the following projects:-

Wullar Barrage/Tulbul Navigation Project

32. The second challenge to the treaty came regarding the construction of the Wullar Barrage, as it is called by Paksitan, or Tulbul Navigation Project as termed by India. The dispute arose in 1984 when India began to build the barrage and navigational project at the mouth of the Wullar Lake on the River Jhelum. In 1986, Pakistan referred the case to the Indus Commission, and in 1987 work was halted on the project by India. The main point of dispute is that Pakistan views the project as a storage work while India claims that it is a navigational project.

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33. These divergent positions are further urged in the light of specific provisions of the Indus Waters Treaty. For Pakistan, the project violates Article I (11) that prohibits both parties from undertaking any ‘man-made obstruction’ that may cause a change in the volume of water. Article III (4) prohibits India from storing any water on the western rivers. Further, sub-para 8 (h) entitles India to construct incidental storage work on the western rivers only after the design has been scrutinized and approved by Pakistan. Its storage capacity should not exceed 10,000 acre feet of water. Pakistan argues that the existing water level in the Wullar Lake is enough for small boats to navigate between Baramula and Srinagar, so there is no need to store additional water. It further argues that the dam’s storage capacity was 32 times more than the 10,000 maf capacity provided under the Indus Waters Treaty.

34. India, on the contrary, contends that despite the broad principles governing the Treaty, India has been allowed, under certain conditions, to construct a barrage in the light of Article 3 (4) conditions, which are enlisted in Annexure D and E of the Treaty. India views the project as an attempt to make the Jhelum navigable, not a reservoir.

35. Controlling water for navigation is permissible under the Treaty. More than a dozen rounds of talks have been held to date over the construction of this barrage but it remains the oldest and longest lasting water dispute between India and Pakistan.

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The Baglihar Dam Issue

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36. The differing views of Islamabad and New Delhi first came to a head after India started constructing the 450 megawatt (MW) Baglihar project in 1999 on the Chenab River. Pakistan believed that the Indian design violated the IWT because the dam included gated spillways which meant that the manipulable storage was larger than that allowed under the IWT. The Indian view was that if they were unable to operate the reservoir more flexibly, it would rapidly fill with silt, as had happened in the earlier Salal project. The Indian and Pakistani IWT commissioners were unable to resolve the “difference”, with Pakistan asking the World Bank to appoint a neutral expert in 2005.

37. The essence of the neutral expert’s verdict, delivered in 2007, was that: the IWT had a provision for updating the implementation of the treaty as new knowledge accumulated; what has emerged as global good practice for silt management would be

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impossible with the rigidities of the treaty; and therefore India should be allowed to draw water out of the dam at lower levels than those specified in the treaty.

38. To understand this interpretation a brief technical digression is needed. Water stored behind a dam is divided between “live storage”, which the operator of the dam can manage through both gated spillways and power intakes, and lower-level “dead storage”, which the operator cannot manage as he does not have outlets in the dam low enough to release this water.

39. The neutral expert, applying considerable semantic subtlety, essentially argued that live storage was not the same as “manipulable storage”. He argued that only storage that could be used for the operational purpose of generating power constituted “live storage”. So if India was creating more “manipulable storage” on the grounds that this was necessary for silt management, then, in the judgment of the neutral expert, this was not live storage and should be allowed. This finding would only make sense if Pakistan’s concern in the treaty was to define exactly where the power outlets could be in the Indian dams (which it never was and is not). But it makes no sense if Pakistan’s concern was India’s capacity to manipulate flows into Pakistan (which it always was and still is).

40. For Pakistan the (non-appealable) Baglihar verdict was a huge blow because it reinterpreted the IWT to remove the fundamental physical protection (limits in manipulable storage) which Pakistan had against the creation of an Indian ability to seriously manipulate the timing of flows of water into Pakistan.

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41. From the Pakistan perspective, salt was rubbed into this raw wound when India did not (in Pakistan’s view) comply with the IWT-specified process for filling Baglihar.

The Kishenganga Hydroelectric Project

42. Present flashpoint of Kishenganga Hydroelectric project in Indian-held Kashmir is unique. In India the westward-flowing Jhelum River has two main tributaries. The northern tributary, which flows at a substantially higher elevation [] in the foothills of the Himalayas, is the Neelum River. The southern tributary, which flows at a much lower elevation, is the Jhelum itself. The two tributaries join just after they reach Pakistan. This odd configuration offers a unique opportunity – build a barrage across the Neelum, build a tunnel down to the Jhelum, put a power station at the bottom and generate substantial amounts of power. There are two obvious sites where this can be done – one upstream in India and one downstream in Pakistan.

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43. The engineers who drew up the IWT were well aware of these possibilities and stipulated that India could build its project only if there is no existing use which will be affected in Pakistan. India is now building the “eastern scheme” (the 330 MW Kishenganga project) while Pakistan is building the “western scheme” (the 1,000 MW Neelum-Jhelum project). The immediate stakes and investments are large – approximately $350 million in India and $1,000 million in Pakistan. Disillusioned with the neutral expert process after Baglihar, in May 2010 Pakistan declared this to be a “dispute” to be taken to a Court of Arbitration.

44. The Neelum-Jhelum case is unique because it is the one case in the Indus Basin where there is an intrinsic conflict between India and Pakistan. In all of the other cases upstream storage of water in India could, if normal relations pertained, easily be translated into benefits for downstream Pakistan. These benefits would include the more reliable timing of flows, storage of water during floods and perhaps even energy sharing.

45. The situation is further complicated by the fact that India has a series of hydropower projects being planned, designed and constructed on the headwaters of Pakistan’s three rivers which will create something like 40 days of live storage on the Chenab alone. From the Pakistani perspective this ability to hold and release water constitutes a serious threat to water security in Pakistan.

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IWT: Internal & Regional Problems

46. Besides these dam projects, there are several internal and regional issues that strain the Indus Waters Treaty. The most important is the view of the people in Jammu and Kashmir who see the Treaty as exploiting [] their rights by both India and Pakistan. People of the northern areas in Pakistan are also opposed to dam projects in Pakistan like the Mangla dam.

47. Secondly, hostile anti-Pakistan segments in India view the Indus Water Treaty as giving undue concessions to Pakistan, which Prime Minister Nehru signed to ‘purchase peace’. Since it did not bring peace to Kashmir, they want to revisit the concessions given to Pakistan under the Treaty.

48. Third, Pakistan also has serious problems regarding the sharing of Indus waters among its four provinces. This is evident with entrenched controversy being present in the country on every planned dam. The shortage of water has deep political, economic and social effects. For example, farmers in Sindh point their fingers at Punjabi landlords, and accuse them of ‘stealing their share’ of the Indus’s water.

49. Finally, there are environmental and ecological changes which call for consideration. Because of climate change, the Himalayan glaciers are melting at an alarming rate. For water resources, this means an increase in water initially due to

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flooding. Within the next 50 years, however, experts believe there will be a 30 to 40 percent [] drop in glacial melt because the glaciers will have receded. A strategy to create more storage capacity for water is the only option available, but one has to remember that glacial melt is not only water but also silt that will reduce the capacity of the reservoirs. This aspect has not been considered at the political level or at least has not gained prominence.

50. Essentially the following two features have shaped Pakistan-India water politics:

(a) The underlying concern of both states is the political aspects that water entails. This aspect is believed to be the catalyst [] behind the hydro politics in which both countries are engaged. Thus, the discussion on water issues has always been there in almost every dialogue between India and Pakistan, and now it figures in the high level talks that reflects the dominance of water issues.

(b) Most of the time, Pakistan being the lower riparian follows up on these issues on sharing of waters more vigorously. It has objected to almost all the projects planned by India on the western rivers calling them a violation of the

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Indus Water Treaty. Nonetheless, India does not accept this view and takes defensive positions.