MEMBERS' REFERENCE SERVICE LARRDIS LOK SABHA SECRETARIAT, NEW DELHI REFERENCE NOTE. No.04/RN/Ref./January/2017

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1 MEMBERS' REFERENCE SERVICE LARRDIS LOK SABHA SECRETARIAT, NEW DELHI REFERENCE NOTE No.04/RN/Ref./January/2017 For the use of Members of Parliament NOT FOR PUBLICATION 1 INDUS WATERS TREATY 1960 Prepared by Shri Jayadev Sahu, Additional Director ( ) and Shri Sai Ram C.V., JLA of Lok Sabha Secretariat under the supervision of Smt. Kalpana Sharma, Joint Secretary and Smt. Anita Khanna, Director. The reference material is for personal use of the Members in the discharge of their Parliamentary duties, and is not for publication. This Service is not to be quoted as the source of information as it is based on the sources indicated at the end/in the text.

2 INDUS WATERS TREATY Indus System Of Rivers The Indus basin has an areal extent of 4,50,000 square miles (1,165,000 km 2 ). The Indus system of Rivers comprises three Eastern Rivers (The Sutlej, The Beas and The Ravi) and three Western Rivers (The Indus, The Jhelum and The Chenab). The Indus system includes the Kabul tributary from west, flowing from Afghanistan direct to Pakistan without crossing through India. The basin is mainly shared by India and Pakistan with a small share for China and Afghanistan. Within India, the Indus basin lies in Jammu & Kashmir, Himachal Pradesh, Punjab, Haryana and Rajasthan. As per the Irrigation Commission Report (1972), the drainage area in India is 3,21,289 km 2 which is nearly 9.8 percent of the total geographical area of the country. Jammu & Kashmir 1,93,762 km 2 Punjab 50,304 km 2 Himachal Pradesh 51,356 km 2 Haryana 9,939 km 2 Rajasthan 15,814 km 2 Chandigarh 114 km 2 A map of the Indus basin is given in Annexure 1 Total 3,21,289 km 2 1 The Reference Note is Primarily based on the material received from the Indus Wing, Ministry of Water Resources, River Development & Ganga Rejuvenation, unless otherwise mentioned in the Note.

3 2 Historical Perspective At the time of independence, the boundary line between the two newly created independent countries i.e. Pakistan and India was drawn right across the Indus Basin, leaving Pakistan as the lower riparian. A dispute thus arose between two countries regarding the utilization of irrigation water from existing facilities. After eight years of negotiations under the aegis of World Bank, the Indus Water Treaty was signed at Karachi on 19 September The Treaty however is effective from 1 April 1960 (Effective Date). Contents of the Treaty The Indus Waters Treaty contains a Preamble, twelve articles and eight detailed annexures, as given in Annexure II. Salient Provisions of The Treaty The waters of the Eastern Rivers, about 33 Million Acre Feet (MAF), stand allocated to India (Article II) and those of the Western Rivers, about 135 MAF, to Pakistan (Article III). However, India is permitted to use the waters of the Western Rivers for: Domestic Use, Non-consumptive use, Agricultural use as specified (in Annexure C), Generation of hydro-electric power. This use is unrestricted subject to the conditions specified in Annexure-D. As per Annexure E to the Treaty (Storage of Waters by India on the Western Rivers), the aggregate capacity of all single-purpose and multipurpose reservoirs constructed by India after the Effective Date shall not exceed 3.6 MAF as specified. While India can build no storage on the Western Rivers save as specified above, the Treaty permits India to build run-of-the-river hydroelectric plants. This use is unrestricted, but there are design and operational restrictions on the plants. 2 The Indus Water Treaty 1960 was signed on 19th September in Karachi, by Pandit Jawaharlal Nehru (Prime Minister of India) on behalf of India and by Field Marshal Mohammad Ayub Khan (President of Pakistan) on behalf of Pakistan. The Treaty was signed on behalf of the World Bank by Mr. W.A.B. Iliff (Vice President of the Bank)

4 3 The Treaty also requires India to supply information (specified in the Treaty) on new Run-of-River Plants to Pakistan to enable it to satisfy itself that the design conforms to the criteria specified in the Treaty. This information must be supplied at least six months in advance of the beginning of construction of river works connected with the Plant. The Treaty stipulates the exchange of data between the two sides. Daily data relating to the flow in and utilization of the waters of the rivers are exchanged between the Parties every month [Article VI(1)]. Not later than the 30November every year, India supplies tehsil-wise Irrigated Cropped Area on Western Rivers to Pakistan and Pakistan also supplies tehsil-wise data of areas irrigated or cultivated on sailab on certain tributaries of river Ravi. The Treaty provides for the institutional mechanism for implementing the Treaty through Permanent Indus Commission(PIC) comprising of one Indus Commissioner each from both the countries. Each Commissioner represents his country for all matters arising out of the Treaty and serves as regular channel of communication on all matters relating to the Treaty. The Commission is required to meet at least once a year. Further, the Commission is required to undertake once in every five years a general tour of inspection of rivers for ascertaining facts and also undertake the tour promptly at the request of the Commissioners. The Treaty provides for settlement of differences/disputes as per Article IX of the Treaty. The questions that may arise on the design of such projects are first examined by the PIC and in case PIC is not able to resolve the same, the issues of the technical nature may be referred to Neutral Expert and that pertaining to interpretation of the Treaty may be referred to Court of Arbitration. There is no provision for suspension of the work unless ordered by the Court of Arbitration. The Treaty shall continue in force until terminated by a duly ratified treaty concluded for that purpose between the two Governments. Functioning of the Commission The Permanent Indus Commission has been performing its role in a reasonably satisfactory manner. Meetings and tours take place on a regular basis. The data stipulated in the Treaty are exchanged. Issues raised by either side are deliberated upon. The Commission submits its Annual Reports (on

5 4 work performed, issues discussed, their status etc.) to the Governments regularly. The Commission has so far undertaken 118 tours of inspection and 112 meetings in both the countries put together. There have been 73 general tours of inspection and 45 special tours of inspection. Development of Rights provided to India in the Treaty Eastern Rivers 1. All the waters available to India allocated to Punjab, Haryana, Rajasthan, J&K, Delhi. 2. India has constructed the following live storage works totalling about 13.6 MAF which help harness the waters of the Eastern Rivers fully: Bhakra MAF Pandoh MAF Pong MAF RanjitSagar MAF 3. Bhakra Canal Command, Indira Canal Command have been substantially developed and Network of links - Madhopur-Beas, Beas-Sutlej links constructed. Western Rivers Irrigation Cropped Area permitted and developed. Developed 8 lakh acres. Further development of 1.12 lakh acre can be done without storages and another 4.2 lakh acre after development and release of 0.5 MAF through storage. Hydropower Potential assessed In operation Under construction Under advance stages of planning Most of the potential is in Chenab basin. 18,653 MW 3,034 MW 2,526 MW 5,846 MW Storage: Created NIL

6 5 Major Issues Raised by Pakistan in the Commission As per provision of Treaty, information on new projects is required to be sent to Pakistan at least six months prior to start of river works. Pakistan can raise objections on the design of projects under provisions of Treaty. The same are discussed in the PIC for amicable resolution. However, whenever resolution is not achieved in PIC, the matter can be taken up to the third forum -Neutral Expert (NE) or Court of Arbitration (CoA) for resolution as provided in Treaty. (I) Kishenganga Hydro Electric Project (KHEP) Kishenganga Hydro-Electric Project envisages construction of a dam on the river Kishenganga (called as river Neelum by Pakistan), a tributary of River Jhelum, as also construction of a 23 km long tunnel for diversion of 58.4 cumec of water from its reservoir to a power house. After power generation, the project envisages discharge of water into Bonar nallah near Wularlake, from where water will flow into river Jhelum and eventually to Pakistan. Six issues related to Kishenganga Hydro Electric Project were raised by Pakistan in Two of the six issues which related to interpretation of provisions of the Treaty were taken to the Court of Arbitration by Pakistan under Article IX of Treaty. The two disputes were: i) The Permissibility of delivering the waters of the Kishenganga/ Neelum river into another tributary through the KHEP and ii) Whether under the Treaty, India may deplete or bring the reservoir level of a run-of-river Plant below Dead Storage Level (DSL) in any circumstances except in the case of unforeseen emergency. Both of the above disputes have been settled by Court of Arbitration (CoA) in year The Court allowed India to divert water from the Kishenganga/Neelum river for power generation. The Court decided that

7 6 India 'shall release a minimum flow of 9 cumec into the Kishenganga /Neelum river below the Kishenganga Hydro Electric Project at all times 3. The remaining four technical issues remained under discussion in the Commission which could resolve one of them that relates to freeboard of the dam. The discussions on remaining three issues continued. Pakistan however in 2015 gave notice for appointment of Neutral Expert. It later withdrew the notice in February 2016 and expressed its intention to resolve the matter through Court of Arbitration. (II) Ratle Hydro Electric Project The 850 MW Ratle Hydro Electric Project located on the River Chenab in the state of Jammu & Kashmir is planned to be developed as run-of-the-river scheme. Pakistan side raised objection on pondage and other design features like low level orifice spillways, freeboard etc. in Indian side has given due justification for each of the design features. However Pakistan has given notice for Court of Arbitration. The negotiations were also held at the level of Secretaries of both the countries on July 2016 but could not resolve the issues. India thereafter requested World Bank to appoint the Neutral Expert under the provisions of the Treaty to resolve the differences on both Kishenganga and Ratle Hydro Electric project. Present Status India and Pakistan disagree over whether the technical design features of the two hydroelectric plants contravene the Treaty. Pakistan asked the World Bank to facilitate the setting up of a Court of Arbitration to look into its concern 3 Permanent Court of Arbitration Press Release dated 21 December 2013.

8 7 about the technical issues of the two hydro electric projects. India asked for the appointment of a Neutral Expert for the same purpose. In the absence of unanimity on dispute resolution methodology, the World Bank decided to address the technical differences on Kishenganga and Ratle Hydro Electric Projects through the simultaneous invocation of both Neutral Expert and Arbitration Court methods as requested by India and Pakistan, respectively. India protested against this decision as this was legally untenable. On 12 December 2016 the World Bank in its announcement, paused the appointment of a Neutral Expert, as requested by India and the Court of Arbitration, as requested by Pakistan to resolve issues. The World Bank felt that these varying approaches by the two countries, would result in two simultaneous processes and potentially contradictory outcomes with the risk of endangering the Treaty. The World Bank asked both the countries to consider alternative ways to their disagreements. It also appointed one of its officials to help in breaking the deadlock. 4 The World Bank Advisor Mr Solomon held talks with Indian officials in Delhi on 5-6 January 2017 wherein Indian side reiterated its position. Sources consulted 1. Inputs from the Ministry of Water Resources, River Development & Ganga Rejuvenation. 2. Indus Waters Treaty, The World Affairs, Vol. 123, No.4, 1960, pp Permanent Court of Arbitration Press Release. 4. World Bank Press Releases. 4 World Bank Press Release dated 12 December 2016.

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10 9 Annexure II Article Preamble Article I Article II Article III Article IV Article V Article VI Article VII Article VIII Article IX Article X Article XI Article XII Annexure A Annexure B Annexure C Annexure D Annexure E Annexure F Annexure G Annexure H Definitions Provisions Regarding Eastern Rivers Provisions Regarding Western Rivers Provisions Regarding Eastern Rivers and Western Rivers Financial Provisions Exchange of Data Future Co-Operation Permanent Indus Commission Settlement of Differences and Disputes Emergency Provisions General Provisions Final Provisions Exchange of Notes between Government of India and Government of Pakistan Agricultural Use by Pakistan from Certain Tributaries of the Ravi Agricultural Use by India from the Western Rivers Generation of Hydro-electric Power by India on the Western Rivers Storage of Waters by India on the Western Rivers Neutral Expert Court of Arbitration Transitional Arrangements