India Wins Diplomatic Victory in Indus Waters Treaty Dispute

India has secured a significant diplomatic victory with the recent decision by the Neutral Expert appointed by the World Bank under the Indus Waters Treaty (IWT). The expert affirmed his "competence" to address the technical disagreements between India and Pakistan over the design of two hydroelectric projects in Jammu and Kashmir. This decision aligns with India’s long-standing position and marks a new phase in resolving disputes under the IWT framework.

What is the Indus Waters Treaty (IWT)?

The Indus Waters Treaty, signed on September 19, 1960, is a water-sharing agreement between India and Pakistan, brokered by the World Bank. It is considered one of the most successful conflict resolution models between the two nations.

Key Features of the Treaty:

• Distribution of Rivers:
  • Allocated to India for unrestricted use.
  • Reserved for Pakistan, with limited use for India for irrigation, navigation, and hydroelectric projects.
• Water Allocation:
  • India controls around 30% of the Indus River system water, while Pakistan controls the remaining 70%.
• Obligation on India:
  • Article III (1) of the Treaty mandates India to allow the unrestricted flow of the Western Rivers to Pakistan, except for specific permitted uses.

The Ongoing Dispute: Pakistan’s Objections

The dispute centers around two Indian hydroelectric projects in Jammu and Kashmir:

• Kishenganga Hydroelectric Project (HEP) on the Kishenganga River (a Jhelum tributary).
• Ratle Hydroelectric Project (HEP) on the Chenab River.

Pakistan’s Allegations:

Pakistan claims that these run-of-the-river projects violate the IWT, alleging they manipulate water flow and may affect downstream water availability for Pakistan.

India’s Stance:

India asserts that both projects comply fully with the IWT’s technical specifications, with their run-of-the-river design maintaining the natural flow of water and only limited storage allowed under the Treaty.

Legal Developments: Neutral Expert Appointment and Process

Pakistan requested a Neutral Expert in 2015 to resolve its objections. However, in 2016, Pakistan withdrew this request and sought arbitration via the Permanent Court of Arbitration (PCA), prompting India to argue that the PCA process was inconsistent with the Treaty. India filed a separate request to refer the matter back to the Neutral Expert, as outlined in Article IX of the Treaty.

In October 2022, the World Bank initiated two parallel processes, appointing Michel Lino as the Neutral Expert and starting PCA proceedings, which India chose to boycott, calling it a violation of the Treaty.

The Neutral Expert’s Ruling

The Neutral Expert’s decision on January 7, 2025, stated that the issues raised by India concerning the two hydroelectric projects fell within his jurisdiction under the Treaty. This decision is a major diplomatic win for India, affirming the Treaty’s dispute resolution mechanism.

Challenges and Future of the IWT

Over the years, the IWT has faced challenges, particularly due to Pakistan’s repeated objections and reluctance to engage in fair adjudication. India has called for a review and modification of the Treaty, citing ongoing obstructionism.

Key developments include:

• January 2023: India issued a notice to Pakistan regarding the modification of the Treaty.
• September 2024: India issued a second notice, signaling its intent to renegotiate the Treaty.

The future of the 65-year-old Treaty is now under scrutiny, with India pointing to "fundamental and unforeseen changes in circumstances," such as demographic shifts, growing water demand, environmental concerns, and cross-border terrorism’s impact on trust. Under Article XII (3) of the Treaty, provisions may be modified through a duly ratified agreement between both governments.