On Dec. 20, the Hague-based Permanent Court of Arbitration rendered its final award in the Indus Waters Kishenganga Arbitration between Pakistan and India. This decision has produced much confusion, nationally and internationally. The confusion is uncalled for. The award is a clear victory for Pakistan: it resolves a potentially explosive dispute in Pakistan’s favor, and it ensures that similar disputes do not arise in the future.
Pakistan invoked arbitration for its water dispute with India on May 17, 2010, in accordance with the World Bank-brokered Indus Waters Treaty of 1960. Following site visits to Pakistan’s Neelum-Jhelum and India’s Kishenganga hydropower projects, the seven-member court began hearings in August 2012 and rendered a partial award the next February.
Islamabad had referred two separate questions to the arbitrators. The first question asked whether India could draw down reservoir water below dead-storage level in any event other than an unforeseen emergency. The second asked whether India’s diversion of waters was in violation of the 1960 accord.
The first, more important matter has been decided conclusively in Pakistan’s favor. The second one has thrown up a split verdict, which still marks an improvement in Pakistan’s position: contradicting India’s stance, the Court of Arbitration says that Kishenganga notwithstanding Pakistan is entitled to a minimum flow of water, i.e., 9 cubic meters per second, into its rivers.
The water dispute between Pakistan and India dates back to Partition. The British made no arrangements whatsoever for the equitable distribution of the rivers in the Indus basin, even though the boundary between Pakistan and India cut right across it. The assumption was that the status quo would continue until Pakistan and India worked out an arrangement. This assumption was rudely disturbed on April 1, 1948, when India stopped the flow of certain canals into Pakistan.
Historians still debate the physical impact of the stoppage, but no one doubts that it left Pakistan with a deep sense of unease. From then on, the one consistent aim in Pakistan’s water policy has been to minimize India’s ability to interfere with flows. Thus, while the initial efforts to negotiate an agreement on water issues envisaged a cooperative, basin-wide mechanism, those efforts were soon abandoned in favor of a more practical approach based on clean, clear lines of demarcation. The end result, in 1960, was the division of rivers. India got the three eastern rivers; and Pakistan got the three western ones.
The Indus Waters Treaty of 1960 also laid down strict obligations on the parties: India was to “let flow” the waters of the three western rivers allocated to Pakistan. And while it was allowed to use these western rivers for electricity generation, the design parameters of future hydroelectric plants were also specified in detail. The Treaty gave concrete form to Pakistan’s apprehensions regarding India and strikes a balance between Pakistan’s security needs and India’s energy needs. In other words, India is free to build as many hydroelectric projects as it wants as long as it respects Pakistan’s legitimate security concerns through designs that limit its ability to stop water flows to Pakistan.
For example, the design parameters for run-of-the-river plants provide that the spillway for a hydroelectric plant shall not be gated unless absolutely necessary. Further, if a gated spillway becomes necessary, then the gates shall be as high as possible. Similarly, other rules provide that to the extent there is any outlet from the reservoir of a hydroelectric plant, those outlets shall be as small and as high as possible.
What is a spillway? If the reservoir of a hydroelectric plant is a giant tub, then the spillway is the hole through which the tub is emptied. A reservoir without a gated spillway is like a tub with no drain: once it fills up, the excess water simply flows out over the top. On the other hand, a gated spillway allows reservoir water to be drained down. Since Pakistan does not want India to be able to empty reservoirs, it wants the spillways to be high.
Between 1960 and 2007, there was little debate on this topic of spillways. This was partly because there was no dispute as to the effect of the relevant provisions, and partly because India built very few projects. All of this changed as a consequence of the Baglihar project. What made Baglihar different from earlier Indian projects was that its design provided for a number of very large spillways well below the surface of the dam’s reservoir.
In simple terms, there is a portion of every reservoir that India is allowed to use (live storage) and a portion it is not (dead storage). Because the spillways at Baglihar were well below dead-storage level, this meant that India could control not just the “live storage” but also all the “dead storage” above the spillway. In concrete terms, Pakistan estimated that if India emptied the Baglihar reservoir during the winter, it would be able to stop the flow of the Chenab River for 27 days. So Pakistan challenged the Baglihar design, and the issue was ultimately referred to an independent neutral expert.
India’s defense before this expert was that the design was justified because the low-level spillways would keep the reservoir free from sediment. Pakistan’s response was that because the Treaty prohibits India from drawing down reservoir water below a certain point, the low-level outlets in the Baglihar design were useless. In return, India argued that even if it could not bring the water level down, the outlets were nonetheless effective. So far as the legality of drawing down the water level was concerned, both parties initially assumed that the Indus Waters Treaty prohibited it.
The expert, however, was not to be so restrained. He first agreed with Pakistan that in the absence of drawdown, the low-level outlets were useless. However, instead of deciding in Pakistan’s favor, he went ahead and held that because bringing the water level down was permitted in certain cases, the design of Baglihar was legal.
The expert’s decision placed Pakistan in an awkward position. A frontal challenge was out of the question because the Treaty clearly provides that the decision of an expert on all matters within his or her competence is final and binding. At the same time, the Baglihar decision was unacceptable and entirely outside the boundaries of the Treaty. More importantly, India then announced its plans to build a slew of projects on the western rivers, thereby raising the specter of Pakistan’s archrival being armed with the legal means to stop the flow of its rivers for months at a time. These announcements were then repeatedly highlighted by the more jingoistic elements of Pakistan’s press causing panic among Pakistani pundits.
Pakistan decided to give up Baglihar as a lost cause and concentrate instead on challenging the principle underlying the expert’s decision. The strategy was to raise a general legal dispute regarding the legality of drawing down water for sediment control and have that dispute adjudicated by the Court of Arbitration rather than another neutral expert. This strategy was facilitated by the fact that the Indian design for Kishenganga also featured large low-level outlets.
There is a lingering belief in Pakistan that the Indus Waters Treaty of 1960 was a sellout by the Ayub Khan regime. This is rubbish.
It is this strategy that has now borne fruit in the Kishenganga arbitration. The Court of Arbitration has rejected the expert’s argument and clearly decided that India is not entitled to draw down the water level of a reservoir except in the case of an unforeseen emergency. Since sediment control is not an unforeseen emergency, this means India will now have to change the designs of all its planned projects on the western rivers. In short, India’s projects will now have very limited ability to interfere with the flow of the Pakistan-allotted western rivers. The Kishenganga award thus restores the balance contained in the Treaty and safeguards Pakistan’s security.
The second question referred by Pakistan to the Court of Arbitration was specific to Kishenganga. In brief, Kishenganga envisages the generation of electricity via the diversion of water from the Neelum River into Wullar Lake, which drains into the Jhelum River, which rejoins the Neelum River at Muzaffarabad (so the diverted water eventually returns to Pakistan). Pakistan challenged this diversion on two grounds: first, that diversion was per se illegal; and second, that India’s plans to divert all the water possible would negatively affect Pakistan’s planned downstream projects on the Neelum.
The Court of Arbitration has rejected Pakistan’s first contention that the Treaty prohibits any diversion, but accepted its second one that India does not have an unlimited right to divert waters. This is not a terrible calamity for Pakistan. In practical terms, India’s right to divert is limited to the Kishenganga project alone. Critics who fear that India has been handed a blank check to divert waters meant for Pakistan are mistaken.
In terms of the amount of permissible diversion, Pakistan presented two arguments.
The first argument was that because the Treaty conditioned India’s diversion upon Pakistan’s “then existing” usages, India could only divert water to such extent and at such times as would not affect Pakistan’s downstream usages, whenever those usages happened to come into effect. The reason for the “whenever” argument was because while Pakistan is also constructing the 969-megawatt Neelum-Jhelum hydroelectric plant near Muzaffarabad, this plant is likely to finish construction several years after Kishenganga. Pakistan’s argument was that India can divert the water so long as Pakistan does not need it, but that India will have to stop diverting as and when Pakistan needs that water (i.e., when Neelum-Jhelum comes into operation). Pakistan’s second argument was an environmental one. It contended that a river, by itself, has a particular value which must be respected by keeping the river “alive” through the release of certain minimum flows.
In both cases, Pakistan’s intent was to preserve as much of the natural water flow of the Neelum River so as to protect the economic value of the Neelum-Jhelum plant. According to Pakistan’s estimates, India’s planned diversion would result, on average, in a 16 percent reduction of annual flows at the Neelum-Jhelum plant.
India’s response to both of these arguments was, in effect, to tell Pakistan to lump it. India argued that since it had committed to the Kishenganga project before Pakistan had committed to Neelum-Jhelum, India had acquired a permanent right of diversion which could never be affected, no matter how many Pakistani hydroelectric plants came online downstream of Kishenganga. Similarly, India argued that the Treaty made no express provision for environmental harm and, consequently, India was not required to release any water whatsoever so long as such water could be diverted for energy-generation purposes.
The Court of Arbitration has rejected both of India’s arguments. It has held that India’s right of diversion is not absolute but must also take into account Pakistan’s downstream usages. Similarly, the Court of Arbitration has held that modern environmental norms must be read into the Treaty and that India must ensure a minimum flow of 9 cubic meters per second at all times. As a result, the feared 16 percent reduction in annual flows at Neelum-Jhelum has been shaved down to 10 percent. This is not an optimal result from Pakistan’s perspective, but certainly a significant improvement over what India was earlier offering, i.e., nothing.
Notwithstanding the fact that Pakistan has—on balance—scored a victory, the Kishenganga award has met with a storm of criticism in Pakistan. This is largely because the impact of the design issue is difficult to comprehend. The other reason for the criticism is the lingering belief in Pakistan that the Indus Waters Treaty was a sellout by the Ayub Khan regime. This is rubbish. Pakistan’s decision to sign the Treaty is regarded by almost all knowledgeable scholars as a smart and pragmatic decision, which protected its extremely vulnerable lower-riparian position. The reason that Pakistan wound up with three rivers is because regimes preceding Ayub Khan’s had rejected offers to accept four and even five rivers. The three western rivers assigned to Pakistan account, on average, for 80 percent of available water. Finally, the fact remains that Pakistan was not in a position to insist on a better deal in 1960. It is in an even weaker position now: if the Treaty were to be renegotiated today, it is a cast-iron certainty that Pakistan would receive fewer benefits than it currently enjoys.
Pakistan took two questions to the Court of Arbitration. One has been emphatically decided in Pakistan’s favor, while the other represents a partial victory. Pakistan’s victory on the drawdown question will affect every future project India designs. And India’s ability to divert water at Kishenganga has been limited and won’t recur. The Dec. 20 award upholds the Indus Waters Treaty of 1960 and secures Pakistan’s energy future. Pakistani critics who claim otherwise are, as usual, missing the forest for the trees.
Naqvi is a senior lawyer who was involved in the early stages of the Kishenganga dispute and who represented the Pakistani government in the Baglihar dispute. From our Jan. 18, 2014, issue.