The 1960 Indus Waters Treaty has been one of the most enduring and significant water-sharing agreements in the world, governing the allocation and use of the Indus River system between India and Pakistan. On January 21, 2025, the ‘Neutral Expert’ issued a press release confirming the ‘competence’ to address the seven ‘differences’ raised in connection with the Kishanganga and Ratle hydroelectric projects India is constructing on the western rivers of the Indus system. The decision reaffirms India’s long-standing and principled position that these differences are well within the Neutral Expert’s mandate under the Treaty and should not have been escalated to an “illegally constituted Court of Arbitration (CoA).” This ruling is a significant milestone in the ongoing dispute and strengthens India’s legal and procedural stance under the treaty’s framework.
India has ‘welcomed’ the decision by the Neutral Expert issued under ‘Paragraph 7 of Annexure F’ to the Indus Waters Treaty, 1960. The ruling validates India’s position that all seven differences concerning the Kishanganga and Ratle hydroelectric projects fall squarely within the jurisdiction of the Neutral Expert and should not be considered disputes requiring arbitration. India has consistently maintained that the Neutral Expert must first examine technical and interpretational issues related to project designs before they can escalate to a formal legal dispute resolution mechanism. With the ruling affirming his jurisdiction, the Neutral Expert will now proceed to the ‘merits phase’ of the process, which will lead to a final decision on each of the seven differences.
The Indus Waters Treaty is structured with a well-defined three-tiered dispute resolution mechanism, starting with bilateral negotiations under the Permanent Indus Commission (PIC). The current controversy arose when Pakistan unilaterally sought arbitration in 2016, contending that India’s hydroelectric projects violated the Treaty by affecting the water flow into Pakistan
The Indus Waters Treaty is structured with a well-defined three-tiered dispute resolution mechanism, starting with bilateral negotiations under the Permanent Indus Commission (PIC). The current controversy arose when Pakistan unilaterally sought arbitration in 2016, contending that India’s hydroelectric projects violated the Treaty by affecting the water flow into Pakistan. On the contrary, India insisted the matter should be handled by the Neutral Expert first, as per the Treaty’s procedural framework. However, in an unprecedented move, Neutral Expert proceedings and a Court of Arbitration were initiated simultaneously, creating a legal dilemma and a divergence in procedural approach.
By affirming this competence, the Neutral Expert has effectively endorsed India’s position, ensuring that the technical aspects of the Kishanganga and Ratle projects are evaluated within the appropriate forum. This decision not only upholds the sanctity of the Indus Waters Treaty but also prevents a dangerous precedent wherein Pakistan could bypass the treaty’s mechanisms and seek arbitration prematurely. The ruling is a crucial procedural victory for India, as it reaffirms that differences related to the technical design of hydroelectric projects must first be adjudicated through the Neutral Expert process, as outlined in Annexure F of the Treaty.
The merits phase of the proceedings will now analyse the seven differences over the design elements of the Kishanganga and Ratle projects that Pakistan has challenged. India has maintained that its projects comply fully with the Treaty’s design constraints and permissible storage limits, ensuring Pakistan’s downstream water rights remain unaffected
The merits phase of the proceedings will now analyse the seven differences in detail, focusing on the specific design elements of the Kishanganga and Ratle projects that Pakistan has challenged. These include issues related to ‘spillway gates, drawdown flushing, and sediment management’, among other technical parameters. India has maintained that its projects comply fully with the Treaty’s design constraints and permissible storage limits, ensuring that Pakistan’s downstream water rights remain unaffected. The outcome of this phase will be instrumental in determining the extent to which India can proceed with its hydroelectric infrastructure development within the western rivers.
India has reiterated its ‘commitment’ to preserving the ‘sanctity and integrity’ of the Indus Waters Treaty by actively participating in the Neutral Expert process. India firmly holds that the Treaty does not allow ‘parallel proceedings’ on the same issue and, therefore, does not recognise the legitimacy of the Court of Arbitration. By adhering to the Treaty’s established resolution mechanism, India reinforces its credibility as a responsible treaty partner, while simultaneously rejecting any attempts to bypass the agreed-upon procedural steps.
A favourable decision in the merits phase will significantly allow India to continue its infrastructure development without further procedural hurdles. On the other hand, any required design modifications must be addressed in a manner that respects the Treaty’s provisions while ensuring minimal disruption to India’s energy and water security objectives
Furthermore, India and Pakistan remain in ‘dialogue’ regarding possible ‘modifications and reviews’ of the Indus Waters Treaty under Article XII(3), which allows amendments to the agreement based on mutual consent. Given the evolving geopolitical landscape, demographic pressures, and technological advancements in water resource management, a periodic review of the Treaty could help address contemporary challenges more effectively. However, India has consistently emphasised that any discussions on modifying the Treaty must be undertaken through ‘bilateral negotiations’ rather than third-party interventions or unilateral actions.
Looking ahead, the outcome of the merits phase will be crucial in determining the technical validity of India’s hydroelectric projects. A favourable decision will allow India to continue its infrastructure development without further procedural hurdles. On the other hand, any required design modifications must be addressed in a manner that respects the Treaty’s provisions while ensuring minimal disruption to India’s energy and water security objectives. This recent ruling sets a precedent for ensuring that disputes under the Treaty are addressed within the appropriate legal and technical framework, reinforcing the credibility and stability of one of the world’s most important transboundary water-sharing agreements.
The writer is Special Advisor for South Asia at Parley Policy Initiative, Republic of Korea. He is a regular commentator on the issues of Water Security and Transboundary River issues in South Asia. The views expressed are of the writer and do not necessarily reflect the views of Raksha Anirveda
