Competent to judge Indus Water Treaty dispute, says World Bank Neutral Expert

Context: The Neutral Expert (NE) appointed under terms of the Indus Water Treaty
(IWT), 1960, decided that he was “competent” to decide on differences between
India and Pakistan on the design of hydroelectric projects built on the Indus
Treaty rivers. The decision was made by Michel Lino, who is the world bank
appointed NE, however the decision is not going to help resolve a demand by India in January 2023 to
renegotiate the IWT but only keeps alive the differences between the two
countries on the dispute resolution mechanism, laid out under the terms of the
treaty.

Key points

·       Overview: The IWT
allocates the three eastern rivers (Sutlej, Beas, Ravi) to India and the three
western rivers (Indus, Jhelum, Chenab) to Pakistan. Signed in 1960, the treaty
aimed at equitable water sharing between the two nations.

·       Parallel
Mechanisms and Legal Challenges: Pakistan’s move for a CoA
led to the World Bank facilitating both a Neutral Expert and a CoA in 2022. India
has refused to participate in the CoA, calling it "illegally
constituted" and contrary to treaty provisions.

·       Engagement
on Treaty Review: India and Pakistan are also in contact under
Article XII (3) of the IWT for the review and potential modification of the
treaty. India issued formal notices to Pakistan for review (August 30, 2024)
and modification (January 2023) of the treaty.

·       Neutral
Expert's Decision: The World Bank-appointed neutral expert, Michel
Lino, ruled in Favor of India's stance, affirming his competence under
Paragraph 7 of Annexure F of the IWT to resolve the differences.

Ø  Indus Water
Treaty 1960 India's Response - The Ministry of External Affairs stated that
the ruling upholds India's consistent position that the neutral expert is the
appropriate authority to address the seven issues concerning the two projects.

Dispute Resolution Mechanism under the Indus Water Treaty (IWT)

·       About: The IWT 1960
outlines a three-tiered dispute resolution process to address disagreements
regarding projects on the Indus rivers. Article IX of the treaty defines this
structured mechanism.

·       Level
1: Permanent Indus Commission (PIC): Initial Notification -
Both parties must inform each other about any planned projects on the Indus
rivers, sharing all relevant information.

Role of PIC - The Permanent
Indus Commission (PIC), established under the IWT, is responsible for managing
and overseeing the treaty's objectives.

Outcome - If the PIC
fails to resolve the disagreement, the issue is escalated to the next level.

·       Level
2: Neutral Expert Appointment: World Bank’s Role - If the PIC is
unable to resolve the dispute, the World Bank appoints a neutral expert to
mediate the issue.

Resolution
Attempts - The neutral expert's goal is to resolve the dispute through technical
assessments and recommendations.

Escalation - If the neutral
expert cannot resolve the matter, it is considered a formal dispute and moves
to the final level.

·       Level
3: Court of Arbitration (CoA): Final Step - When a dispute persists
after the neutral expert's intervention, it is referred to the Court of
Arbitration (CoA).

Chairperson - The chair of
the CoA is appointed by the World Bank.