Indus treaty in jeopardy

June 08, 2018

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THE failure to resolve issues concerning the Kishenganga Hydro Electric Plant became apparent when Indian Prime Minister Narendra Modi inaugurated KHEP on May 19, 2018, in India-held Kashmir. The move prompted Pakistani officials to rush to the World Bank headquarters in Washington to register their protest against India’s completion of the project without resolving technical issues pertaining to restrictions on low-level orifice spillways and plant operations.

The World Bank ‘paused’ the process for appointment of a chairman, court of arbitration, requested by Pakistan and a neutral expert requested by India in December 2016, ostensibly to “protect the [Indus Waters Treaty] in the interest of both countries” and to allow the parties an opportunity to resolve issues concerning the KHEP and the Ratle Hydro Electric Plant amicably. In the interim India, taking advantage of the gap in the process and the ensuing postponement in breaking the deadlock succeeded in completing the project without making changes in design, thus exacerbating the dispute.

The general misconception that the bank is guarantor of the treaty is erroneous as the bank has no treaty-related defined role except for the limited procedural function of appointing a neutral expert or for the bank president to appoint a chairman, court of arbitration in the event that the parties are unable to reach an agreement. The debacle presented by the parties in their differing choices regarding the mechanism for dispute settlement is difficult to comprehend in light of the fact that this very question was discussed and settled by the court of arbitration in the Kishenganga Partial Award.

India’s position on the applicable mechanism on issues raised by Pakistan has been circuitous. It has ranged from refusing to accept that the technical issues fall under the competence of a neutral expert at the Permanent Indus Commission level as, according to India, KHEP was consistent with the parameters defined by the treaty, to stating that the question of drawdown flushing (a technique to manage sedimentation) is non-admissible before a court of arbitration as it comes under the technical questions to be determined by a neutral expert. In its partial award, the court states, “having consistently maintained in the Commission that no difference between the parties existed, India cannot now assert that the second dispute is, in fact, a difference after all...”

India is obligated to design and operate its plants in a manner so as not to cause injury to Pakistan.

The parties’ adversarial relationship was taken into account when drafting the treaty, thus the preamble emphasises the need to make “provision for the settlement, in a cooperative spirit, of all such questions as may hereafter arise in regard to the interpretation or application of the provisions agreed upon herein”. Towards this objective, the treaty provides a comprehensive framework for the resolution of disagreements, avoiding pathological clauses to ensure swiftness in process. Both dispute-settlement mechanisms are scrupulously discussed and the court finds no treaty bar for a court of arbitration to consider questions technical in nature. India’s request for the appointment of a neutral expert at such a late stage when the process of establishing a court of arbitration is nearly concluded can be construed as an attempt to disable that process by placing a procedural hurdle.

More importantly Article IX(1) of the treaty unambiguously provides that a duly constituted court of arbitration can consider any question “concerning the interpretation or application of the treaty or the existence of any fact which, if established, might constitute a breach of this treaty”. The World Bank may have been well meaning, but its conduct in this particular instance has certainly imperilled the process and the efficacy of the treaty. Moreover, there can be no justification or sagacity in maintaining the hiatus for almost 18 months without a commitment from India that it would stop work on the project until all issues were resolved.

KHEP involves the diversion of the waters of the Kishenganga/Neelum river through a 23.24-kilometre tunnel into another tributary and eventually into the Jhelum river. Pakistan will receive this water when it crosses the Line of Control at Chakotthi although the timing and quantity of flows may be affected by this and other Indian projects along the Jhelum. However, the main victims of the diversion are the environment and people of the Neelum valley. The economic well-being and development of the people of the valley is dependent on the river that will now be unable to support sustainable economic development. Degradation of this natural resource will lead to widening inequality, undermine poverty alleviation and create conflict. From news reports it appears that there is similar apprehension and dissatisfaction on the other side of the LoC as 88 per cent of the power generated will go to the national grid.

Although not considered to be economically viable by Indian experts, KHEP is of strategic importance to India as it is an assertion by India over the territory and resources of Jammu and Kashmir. Whatever the motive and irrespective of how ethical and moral it may be India is obligated under international law to design and operate its plants in a manner so as not to damage or cause injury to Pakistan.

Pakistan may be responsible for not taking timely action, but cannot be accused of overreacting as India’s dams on the western rivers impound significantly large volumes of water. The overarching territorial dispute is intricately enmeshed in the bilateral relationship, obstructing comprehensive agreement on treaty issues, therefore, it becomes imperative for external stakeholders to make a genuine effort to steer the two countries towards cooperation. Never before has there been a greater need for both parties to demonstrate a firm commitment to the goals set out in the treaty’s preamble. Extreme weather events and water shortages threaten livelihoods and the social and economic development of the peoples of the two countries. The forces of nature are now intervening to compel the two neighbours to consider peace as they will need to work together if they are to avert the catastrophe presented by climate change.

The bank may well be perceived to be partisan; ranked seventh by voting power in World Bank institutions, India wields political influence in policy and decision-making with the US that ranks as number one. The bank must look beyond the personal associations of its staff, political alignments and its broader business interests to identify a solution to end the predicament lest it be remembered for this uncomfortable legacy.

The writer was legal counsel for the Pakistan government in the Kishenganga arbitration at the Permanent Court of Arbitration, The Hague.

Published in Dawn, June 8th, 2018