Home / News / India /  World Bank not in a position to interpret Indus Waters Treaty: MEA

The Ministry of External Affairs stated that the World Bank was not in a position to interpret the Indus Waters Treaty. The MEA’s statement comes as India has sent a notification to Pakistan calling for both sides to open negotiations to modify the treaty. New Delhi has taken issue with the World Bank’s handling of a dispute between India and Pakistan regarding the construction of two Indian hydropower plants. 

The dispute stems from the Indian government’s desire to build two hydroelectric plants, Kishenganga and Ratle. 

“The two countries disagree over whether the technical design features of these two hydroelectric plants contravene the Treaty. The plants are located in India on tributaries of the Jhelum and the Chenab Rivers, respectively. The Treaty designates these two rivers, as well as the Indus, as the “Western Rivers" to which Pakistan has unrestricted use with some exceptions. Under the Treaty, India is permitted to construct hydroelectric power facilities on these rivers, subject to constraints specified in Annexures to the Treaty," says the World Bank, in a fact sheet explaining the dispute. 

Kishenganga was inaugurated in 2018 while Ratle is under construction. In an effort to settle the dispute, both sides have invoked the Treaty’s dispute settlement mechanism. The World Bank, which helped broker the Treaty in 1960, plays a limited role in managing disputes. 

The nub of the issue lies in how India and Pakistan see the dispute settlement mechanism. 

According to the World Bank, “The Treaty sets out a mechanism for cooperation and information exchange between the two countries regarding their use of the rivers, known as the Permanent Indus Commission, which has a Commissioner from each country. The Treaty also sets forth distinct procedures to handle issues which may arise: “questions" are handled by the Commission; “differences" are to be resolved by a Neutral Expert; and “disputes" are to be referred to a seven-member arbitral tribunal called the “Court of Arbitration." “

India views the dispute mechanism as a gradual, graded process that begins with “question" and moves on to “differences" and so forth. While it has requested the appointment of a neutral expert to begin handling “differences", Pakistan has asked the World Bank to directly set up a Court of Arbitration. This goes against India’s view of a step-by-step approach to dealing with the crisis. 

To New Delhi’s displeasure, the World Bank has granted both requests at the same time. It has both appointed a Neutral Expert at India’s behest and an Arbitrator at Pakistan’s request. This will lead to a parallel mediation process, which India does not agree with. World Bank efforts were put on hold in 2016 to allow India and Pakistan to settle the question of how the mediation process would continue. No workable settlement was found and the World Bank relaunched the parallel mediation process in 2022. 

In response to India’s concerns, the World Bank has stated that “The Treaty does not empower the World Bank to decide whether one procedure should take precedence over the other; rather it vests the determination of jurisdictional competence on each of the two mechanisms."

It was in this context that MEA Spokesperson Bagchi was asked whether this reflected an endorsement of Pakistan’s view. Bagchi stated that the World Bank was not in a position to interpret the Treaty and that India would look to settle the question bilaterally with Pakistan.

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