Indus Water Treaty - II

Mediation by World Bank, Treaty’s Highlights, Provisions and its Success Factors

In the first part of this write up on Indus Water Treaty, we discussed the origin of the dispute and how none of the three stakeholders are happy with it even though the Treaty is internationally hailed as the finest example of water sharing agreement between two countries. In this part, we shall discuss mediation by the World Bank, the key highlights and provisions of the Treaty, funding for construction of the water transfer works and the Treaty’s success factors.   

Mediation by World Bank

With the stalemate on reaching agreement on sharing of waters of the Indus Basin continuing between the India and Pakistan it was in 1951 that World Bank offered to mediate. Right from the outset the Bank recognized that Indus basin water resources should be solved on a functional and not a political plane. The resolution process had to be without relations to past negotiations, past claims and be independent of political issues between the two countries. 

It held that it was an engineering problem and it should be dealt with by engineers. It accordingly asked India and Pakistan to designate a qualified engineer of high standing to jointly prepare a comprehensive long range plan for the most effective utilization of the water resources of the Indus Basin. The Bank also nominated its engineer to assist and facilitate the discussion.   

During the course of the negotiations each country submitted its proposal on sharing of the waters to the World Bank. Strange though it may seem, the proposals submitted by the two countries were not radically different to what was finally agreed after the Bank narrowed down the differences. Both India and Pakistan got marginally less than what they had sought in their proposals. India had sought about 24% of the share of waters and it got around 19% while Pakistan had sought 86% of the share and it got about 81%.   

The Treaty

The Treaty contains twelve articles and eight detailed annexes. These annexes, among other issues, cover ‘Agricultural Use by Pakistan from tributaries of Ravi River’, ‘Agricultural Use by India of water from Western Rivers’, ‘Generation of hydro power by India on the Western Rivers’ and ‘Storage of Waters by Indus on the Western Rivers’. 

The key highlights of the Treaty are: 

(i) Pakistan to receive unrestricted use of waters of the Western Rivers all three of which flow through Jammu & Kashmir. The Treaty though provides for use of some water from these rivers for hydro power generation, domestic use and for agriculture in Jammu and Kashmir.

(ii) India to receive unrestricted usage of water flowing in the three Eastern Rivers allowing it to use of waters of these three rivers for irrigation, transport and power generation.

(iii) regular sharing of meteorological and hydrological data between the two countries including exchange of information about proposed river works 

(iv) setting up of Indus Water Commission, with a commissioner appointed by each country to implement the provisions of the Treaty and seek to reconcile any points of disagreement. The Commission is to facilitate exchange data and cooperation in matters related to the Treaty. 

Annual Flows and Storage Provisions in the Treaty

In volume terms, out of the total 147 billion cubic metres (BCM) of water that annually flow from India to Pakistan, through these six rivers, Pakistan got a little over 80% of the flows and the remaining volume, a little less than 20%, was allocated to India. 

The Treaty provides for a total storage of 4.44 BCM on the three Western rivers – this volume of water is enough to cover all the 10 districts of Kashmir valley with one foot of water. This volume is categorized into three types of storages; general, power and flood storage. It provides for 1.50 BCM of General Storage and 2.0 BCM of Power Storage. In addition, it provides for 0.94 BCM of Flood Storage on tributaries of Jhelum. There is no flood storage provision on Indus or Chenab. Interestingly, no storage of any type, permitted under the Treaty, has been developed so far by India on any of the three Western rivers.  

Connecting Eastern Rivers Fed Irrigation Network in Pakistan to Western Rivers

The division of waters provided for in the Treaty necessitated the construction of irrigation works in Pakistan to transfer water from the three Western Rivers to meet the irrigation uses there, which hitherto were being met by water from the three Eastern Rivers. 

Accordingly, concurrent to the signing of the Treaty, Pakistan and the World Bank also signed the Indus Basin Development Fund Agreement which provided funding for the construction of these irrigation works (canals and storage facilities).

These works, funded by the World Bank, were estimated to then cost more than Rs 510 crores (Rs  33,000 crores at today’s price levels) thus making it then the largest program of its kind ever to have been undertaken anywhere. India also contributed about Rs 82 crores to the fund to compensate Pakistan for loss of irrigation works on Eastern Rivers. Eighty percent of this Rs 510 crores was spent on construction of these irrigation works in Pakistan. 

Success Factors 

There are several factors which contributed to successful conclusion of the Treaty. Primarily, it was the recognition of the benefits of third party mediation by both the two countries.  

Underlying this recognition was the fact that Indus was an engineering problem and that it should be dealt with by engineers who are trained to approach problems with common standards of judgment. While the engineers needed political support, all meetings between two countries were held by engineers, who understood the issues and were not distracted by the other ongoing disputes. 

In addition, it was the Bank’s ability to provide a win-win solution to both sides, in particular, its ability to arrange a large financial package which allowed both countries to rapidly develop their irrigation and hydro power facilities. Finally, it was the patience and persistence shown by all three players in the decade-long negotiations that took place before the Treaty was finally inked.

(In the following part we shall discuss the issues related to Treaty’s provision for water storage in Jhelum Basin and understand whether they have had an impact on our potential storage or flood control projects)


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