India - Nepal Problems in borders and Rivers: Nepal and India, two countries of South Asia, share one of the largest geohydrological regions called Ganga Brahmaputra Basin. Nepal covers a large part of the upper catchment of sub basin of Ganges River. Major rivers of the sub-basin like Mahakali, Karnali, Sapt Gandaki and Sapt Kosi originate from Trans-Himalaya region, cross Nepal and flow southwards to join Ganges in India, and so are international or trans-boundary in nature. Though Nepal occupies 13 percent of the total drainage of the Ganges basin, its contribution to the flow of Ganges river is much more significant, amounting to about 45 percent to its average annual flow. In the dry seasons, Nepal's contribution to the total run-off is as much as 70 percent. These hydrological features bind India and Nepal in a relationship of geographical interdependence and economic complementarities on of water resource development. Although the potential for joint endeavors is considerable, the cooperation between these two countries on the issues related to water resource development has not been easy and forthcoming. Their efforts have been heavily influenced by geopolitics; marked by emphasis on historical wrongs (real and perceived), big-small country syndrome, failure in understanding each other's sensitivities, aggressive posture and negative approach. Major part of second half of last century was lost in the process, incurring huge opportunity cost of delay for both countries. However, a new chapter in the Indo-Nepal relations was opened when the Mahakali Treaty was signed by the then Prime Minister of India Mr. P.V. Narsimha Rao, and the then Prime Minister of Nepal, Mr. Sher Bahadur Deuba, in February 1996 for joint utilization of trans-boundary water resources of the Mahakali River. The signing of Treaty was preceded not merely by intense negotiations between the two governments, the track II meetings, but also by extensive informal consultations covering all parties in Nepal, so as to facilitate the process of parliamentary ratification in Nepal. Indo- Nepal Mahakali Treaty: The Mahakali Treaty subsumes all other Indo-Nepalese agreements relating to downstream projects on the river, thus, it absorbs the regime established by the Sharda Treaty [1920]. It also validates the Tanakpur Agreement [1991], and endorses the idea of multipurpose Pancheswar Multipurpose Project. The scope of the preamble of Mahakali Treaty is quite comprehensive. The treaty aims at “integrated development of the Mahakali River”. It emphasizes the determination of India and Nepal to promote and strengthen their relation of friendship and close neighboruliness for cooperation in the development of water resources. The preamble recognizes the river as a boundary river on major stretches3 in between the two countries to enter into Treaty on equal partnership to define their obligations and corresponding rights and duties with regard to utilization of water of Mahakali River. A. Sharda Barrage: The first part of the Mahakali treaty deals with Sharda Barrage. It points out that Nepal shall have the right to supply of 1,000 cusecs of water from the Sharda Barrage in the wet season (May 15 to October 15), and 150 cusecs in the dry season (Oct. 16 to May 14). India is required to maintain a flow of no less than 350 cusecs downstream of Sharda Barrage in the Mahakali River to maintain and preserve the river ecosystem. B. Sovereignty over Tanakpur Barrage: According to the Treaty, Nepal continues to exercise sovereignty over the land (2.9 hectare) needed for building the eastern afflux bund, as well as a hectare of the pondage area. The Treaty provided an enhanced package to Nepal, of 1,000 cusecs of water in the wet season and 300 cusecs in the dry season, and 70 million Kwhrs of electricity (as against the earlier agreed figure of 20 million Kwhrs) free of charge from the Tanakpur power station, with transmission line to its border. Half the incremental power generated at Tanakpur following augmentation of river flows with the commissioning of the Pancheswar dam will also be supplied to Nepal which will, however, bear half the operational and any additional cost. India will also construct an all weather road connecting the Tanakpur barrage to the Kingdom's East-West Highway, including several bridges en route. There is provision for the supply of 350 cusecs of water for the irrigation of Dodhara Chandni area. C. Pancheswar: The dream Indo-Nepal border project- This is the most important content of the treaty in joint trans-boundary water resource development of India and Nepal. The Mahakali agreement, and the letters exchanged in relation thereto, provide for a joint Indo-Nepal Hydroelectric project on Mahakali River on the basis of a 50:50 cost benefit split. The Mahakali River is a major transboundary river basin between India and Nepal. It forms the western international border of Nepal with India. Starting from Apihimal, the river flows in a gorge section in the upper region. The Mahakali after it flows into India is known as Sharda, which meets the Karnali (Ghaghra) in Indian territory. The river basin has a total drainage area of 15,640 km2, about 34per cent of which lies in Nepal. The proposed dam will straddle the border, which lies along the median point of the river. Two power stations are projected, one on either bank, with an overall installed peaking capacity, between 5,500 and 6,480 MW at 20 per cent load factor. A re-regulating dam could be built either at Poornagiri or further upstream at Rupali Gad to hold the waters passing through the Pancheswar turbines and provide regulated back season release to irrigate designated commands in Nepal and India. They have also agreed to have “equal entitlement in the utilization of the waters of the Mahakali River “without prejudice to their respective existing consumptive uses”. Besides, they agreed to implement the project in all such sectors as power, irrigation, flood control, etc. as per the Detailed Project Report [DPR] to be prepared jointly by them1. The Pancheswar dam will also provide a modest flood cushion. As Pancheswar project is a joint project located on boundary, some general principles applicable to border rivers are laid down. The principles are elaborated in a side letter exchanged by the two prime ministers. The principles commit both sides to design and operate the project as a single, integrated scheme to yield, “the maximum total net benefits accruing to them”. The power benefit is to be assessed on the basis of saving in costs as compared with the relevant alternatives available. The treaty envisages basin development under the aegis of a binational Mahakali Commission, which shall be guided by the principles of equality, mutual benefit and no harm to either party. The Pancheswar project is to be implemented by a joint Pancheswar Development Authority to be set up under an agreed schedule from the date of the treaty's entry into force to develop, execute and operate the Pancheswar project. The treaty has a life of 75 years. There are provisions for review after 10 years and independent arbitration of disputes, with the chairperson being named, if necessary, by the Secretary General of the permanent Court of Arbitration at The Hague2. The treaty has been welcomed by a large number of people on both sides of the border. Many Nepalese experts say the Treaty has successfully broken the impasse created by a legacy of entrenched views on national lines on both sides and finds both sides as winners. The treaty is a first in many ways, primarily in laying down the principles that as a boundary river on large stretches. The principles will influence inevitably to all future water resource agreements between India and Nepal. The Mahakali treaty entered into force on June 5, 1997, the date the instruments of ratification were exchanged by both parties. Although there still are several unclear provisions and incomplete arrangements, the Mahakali Treaty has provided a mechanism for reinforced legal collaboration between India and Nepal on the Mahakali River. Problem of Ambiguities: Though the treaty is formally in operation now, the implementation of provisions has been very slow due to disagreement over interpretation of the provisions. Most of disagreements are about implementation of Pancheswar project. The provisions contained in the Treaty lack specificity. This has left room for ambiguity and controversy in the interpretation of the Treaty. The differences that have emerged in the post Treaty period are: Status of River and Equal Sharing: With regard to the Treaty there is a difference between the Indian and Nepalese views on what the “equal sharing” implies. The Treaty reads “Mahakali is a boundary river on major stretches”. One of the strictures passed along with ratification of Treaty in Nepalese Parliament says,' it means Mahakali is basically a border river. India doesn't agree to this interpretation. The mention of Mahakali River as boundary river might have created a psychological level playing field at the time of signing of Treaty but now it has become source of contention. The Nepalese draw the inference that it belongs equally to the two countries, and therefore, half of the waters of the river belong to Nepal. The treaty recognizes, in principle, Nepalese experts argue, that “Each country own 50 per cent of water”, citing the (1) wordings of preamble i.e. equal partnership to define their obligations and corresponding rights and duties (2) Article 3 on Pancheswar project, i.e. parties will have equal entitlement in utilisation of water of Mahakali (3) Article 5, i.e. water requirement of Nepal shall be given prime consideration in the utilization of waters of Mahakali. (4) Cost sharing formula of project4. Indian water resources expert argue that (1) “there is no warrant for drawing this kind of an inference. The river can be used by the two countries but does not belong to either; (2) any doctrine of ownership of flowing water and the implied right of the upper riparian to 'sell' the water so owned to the lower riparian (who would in any case receive that water naturally by gravity flow) seems non-maintainable. (3) Equal sharing really applies to the incremental benefits and costs attached with Pancheswar project5. These divergence of interpretations need to be sorted out through amicable discussions. Protection of Consumptive Uses - There is a major difference of opinion between Indian and Nepalese water resource experts about defining the “existing uses” that must be deemed to be protected by the Treaty6. The Nepalese experts complain that in the Treaty only the Nepal's existing consumptive uses have been quantified, without quantifying India's usage7. According to the Treaty, the sharing of the capital costs of the Pancheshwar project would be in the proportion of the relative incremental benefits, have to be reckoned after protecting existing consumptive uses of the waters of the Mahakali. Nepal's water demands present no problem and are to be met in full. India's Upper Sharda command of 1.6 mha supplied from Banbassa is also protected. Nepal, however, argues that the 2 mha irrigated from the Lower Sharda Barrage, 160 kms. further downstream, is outside the scope of the “Mahakali” agreement and not a protected existing use. This system primarily depends on water diverted from the Karnali (Ghaghra) at Girjapur through the Sharda Sahayak link for over eight months in the year. But it indents on Sharda supplies during the monsoon between July and October when the Karnali carries a lot of silt. Nepal, however, claims a half share in the incoming river flows between Pancheswar and Banbassa on the “equal entitlement” principle within the common boundary segment of the Mahakali. Indian water resource expert B.G. Verghese feels that Nepal is vaguely asserting the right to ownership of the natural flows of the river, or the discarded Harmon Doctrine, which is untenable principle in emerging international water law. Nepalese water resources experts view that Lower Sarda command area is well below the common border and the treaty covers only the Mahakali River as a border river. Secondly, this matter was never on the agenda during the conclusion of the Treaty and was brought before HMG/N notice only during informal and formal discussion with the officials in Nepal. Nepalese experts also disagree with India's selective reference of Helsinki Rules and now new UN convention for the rights of farmers in the Lower Sarda Canal region, in a situation when India abstained from the voting. Further, they argue that “Prior Appropriation” principle has never been advocated in Kosi and Gandak (revised) Treaties earlier. The absence of quantification of existing water uses of India or even methodology of assessment in the Treaty are extended as arguments for rejection of Prior Appropriation principle in case of Mahakali River8. These are the reasons Nepal did not accept India's claims. However, experts in Nepal, like Pashupati S. Rana, while explaining why existing consumptive use of water in India has been approved of point out “according to generally accepted principle of water consumption having followed for year, the prior right of any country is ipso facto established in the consumption of such water. Hence the prior right of India has in principle been established over the water of the Mahakali River that the country has been consuming from time immemorial9. The recognition of existing consumptive use would have implications for the calculation of irrigation benefit and the “real issue” of sharing the cost of the Pancheswar Project on the basis of the benefits accruing to the either party. If India uses more than its half share of Pancheswar/Mahakali waters it should be prepared to pay a proportionately larger part of irrigation/water component of the project. Regarding the apportioning of the cost of Pancheswar project the DPR report prepared by Nepal indicates about 60 percent of the cost of the project, was to go to hydropower and the remaining 40 per cent to irrigation and flood control. The corresponding figures prepared by Indian technical personnel and brought for discussions at the meeting of Joint Group of Experts (JGEs) are 85 percent and 15 percent respectively, which has remained a point of difference between the two countries. There is a strong feeling in Nepal that such apportioning is guided by India's stand on the prior use of water in the command area of the lower Sarda10. The Kalapani Issue: Though there is no direct relation of Pancheswar with Kalapani, one of the strictures11 passed along on Mahakali in Nepalese Parliament relates with this territorial dispute. The Nepalese object to the Indian military presence in the area called Kalapani. Either the area in question is part of Indian territory or it is not. Indian experts feel that “if the area lies in Indian territory the Indian military presence there is a matter of no consequence to Nepal; if it is a Nepalese territory, India has no business to be there. This is a matter to be resolved with reference to old records, documents, maps, survey reports, etc. The dispute needs to be settled quickly in spirit of good will and not allowed to fester12. Nepalese experts complain that Indians have misunderstood the Nepali sensitivity on the issue. Nepal wants India to adhere to status quo position principle, which it demonstrated on border disputes with Bangladesh and Pakistan. Nepal seeks return of Indian army to the pre 1968 position13. Indian experts argue that nothing is gained by arousing emotion over Kalapani issue and this has nothing to do with implementation of the Mahakali Treaty. Phasing of the Project: A more technical difference relates to the phasing of the project and preference of site for the re-regulating structure. India, initially, conceived an installed capacity of 2000 MW, rising in one or two further stages to anywhere between 5000 to 6000 MW. This was related to the need to investigate and construct a re-regulating dam below the main dam to store and make controlled release of water passing through the Pancheswar turbines to meet the irrigation schedules of commands below. Nepal prefers maximising the estimated 6480 MW potential in one go to secure “maximum total net benefit”. Two possible sites are being discussed for the re-regulating structure. The first, at Rupali Gad, would generate 240 MW and have limited storage on account of its lower height (60 m) and proximity to Pancheswar. India says that the storage this site offers will not meet the irrigation demand. Indian experts prefer further downstream site at Poornagiri for re-regulating structure as this would permit construction of a 180m high dam, provide adequate storage and support a power plant with an installed capacity of 1000 MW. Nepal fears that dam at Poornagiri would inundate 250,000 hectares of fertile land and displace 56,000 people from Nepal hills14. A perception has emerged in Kathmandu that while Nepal is keen on energy export to India, New Delhi looks Pancheswar project structure basically to irrigate vast tracts of land in Indian political heartland of Uttar Pradesh. For the Nepalese, Rupali Gad was the preferred site during the negotiation of the Treaty. The re-regulating a dam sites can be investigated, detailed project reports prepared and work completed within the eight years it will take to complete the Pancheswar Dam. Power Tariff: The side letter to the Mahakali Treaty says that the power benefit is to be assessed on the basis of saving its cost as compared to relevant alternatives available15. Nepalese infer it as an 'avoided cost principle' i.e. India has to pay the price according to the cost of generating the power through alternative means. Dr. Prakash Chandra Lohani, Nepalese diplomat writes “Nepal sells 3,000 MW power from Pancheshwar that will be a saving for India. In the absence of this option, India ought to have generated 3,000 MW of power from coal, which might be costing four rupees for generating one kilowatt of power16. Indians argue that the alternative means can be other HEPs, gas based projects, thermal projects and not necessarily the thermal source only. They are also uncomfortable with Nepal's tendency to gloat over the 'avoided cost principle' victory. Further, if the generation cost at Pancheswar is lower, the gain would surely have to be shared between the two countries. Instead of hypothetical considerations the price of power should be based on mutual negotiation. The price of power should be based on economic considerations, thus it means to be attractive enough to Nepal to undertake the big project and, simultaneously, it should be affordable enough to India to warrant purchase from this source. Whether the heads of ambiguities were deliberately kept as cushion to absorb the possible opposition to the project particularly emanating from domestic politics of Nepal or they were due to a lack of time, can be issues of post analysis or research. At the time of signing of Treaty they definitely played facilitatory role but now they are matters of tough bargaining and negotiation. But these differences in opinion and interpretation of Mahakali Treaty are not insurmountable if both countries cooperate in good faith to carry out the Treaty benefits. Despite several unclear provisions and incomplete arrangements, the Mahakali Treaty has provided a mechanism for a reinforced legal collaboration. The Mahakali Treaty has a provision for the establishment of a joint Indo Nepalese Commission called the Mahakali River Commission (MRC). The commission is guided by the principle of equality, mutual benefit and no harm to either countries and has been assigned a broad mandate. Beyond commission the dispute resolution mechanism envisaged by the Mahakali Treaty is relatively elaborate and advanced. Unfortunately MRC has not been constituted yet. Once MRC is constituted we can expect greater standard of efficiency over implementation of the Treaty, at raising funds, identifying and recommending solutions to the outstanding issues17. But creation of Mahakali Commission can itself require great political consensus as composition of the commission has not been specified. Stricture passed in the Nepal parliament says that Nepal's representative in commission should be named by government with the consent of the main opposition and other national parties- recurrent absence of elected government in Nepal makes consensus difficult. Baggage of Past: Despite huge potentialities and commonalities of objectives, water resource development has faced many setbacks due to political and economic factors that acted against the interests of the two countries. Nepal's complaint about getting unfair deal or being cheated in earlier treaties like, The Kosi Treaty (1954) and the Gandak Treaty (1959), cast its shadow over future collaborations. Nepal water resource experts complained about unilateral initiatives of India, nominal and delayed compensations, disregard for Nepal's interest and unequal benefits. These projects created ill feeling and mistrust between two nations leading to a big gap in joint water resource development initiatives. The efforts between the two countries have suffered due to twin factors. Firstly, policy makers of India for long failed to understand apprehensions of the smaller neighbor. Nepal, a small kingdom, sandwiched between two giant nations has its own world view. India took Nepal for granted on many occasions. Secondly, Nepal overemphasized sovereignty issues and nursed the grudge and mistrust for long. The history of negotiations regarding water projects on Indo Nepal transboundary waters got dominated by controversies primarily due to perceptional difference and the blame game instead of technical difficulties. The Nepalese believe that India is draining Nepal's watershed for its own benefit. Nepalese also blame that Indian water resource bureaucracy has shown business as usual approach combined with arrogance of power and a secretive attitude. The influence of geopolitics in Indo Nepal water resource development has been disproportionate and troublesome. Nepalese have long viewed India as a hegemonic power that arm-twists neighbours for unfair agreements. While Nepal showed disenchantment over joint water resource projects, irritant also arose in bilateral relation due to Nepal's balancing act with China and turbulence in domestic politics of the kingdom. India, in turn, blames Nepal as suffering from small country syndrome, imagining non-existent conspiracies and ignoring India's contribution in different sector of economy of Nepal. Further, fragile and unstable political uncertainties in Nepal also played a role in fueling anti-Indian sentiments. Decades have been lost due to prolonged discussions and Nepal's cautious and deliberate low profile approach. Both the parties are aware of past misgivings, however the negotiations over Mahakali will require out of box thinking to avoid burden of history. Media: Critical yet neglected actor: In transboundary water resources development, planning, geography, politics and technology play major role. However, due to the nature of the resource, asymmetry in size and power, post-colonial era international relations- public opinion has become an important factor. Public perception, information, communication and dissemination thus formed, has become important in the development process. But these rarely figure during project planning stages. Only when a debate and the resulting conflict reach a dead end, the need for information and communication is felt. In many ways disregard of media has impeded development of water resource for cooperative bilateral and regional development. Media coverage on water resources in Nepal is generally replete with sentimentality and concerns. Many times such sentiments are genuine, but the often are alarmist. The reporting on Pancheswar in some of the newspapers, which are backed by opposition political parties, had little to do with water resources. Instead, they read like campaigns aimed at creating a climate for political vendetta. The slogans “what oil is to Middle East, water is for Nepal” or “water is Nepal's strategic resource” have done more harm than good. It has made transboundary water resource an issue of domestic politics. The intense politicisation of the Pancheswar, reflexing to what the opposition in Nepal refers to as “sell-out” has masked the basic issues in water resource development. Unfortunately, the opponents of the project in Nepal are being glorified as nationalists by a section of reporters. This definitely affects moral and commitment of negotiators from our smaller neighbor as they have to interact with extreme cautiousness and apprehension. Even after striking best possible trade off, they may be labelled as negotiators who sold out national interest. Information management has emerged as one of the pre-requisite in transboundary water resource development and management in the Ganga-Brahmaputra basin, for more objective information dissemination. The impact of information on issues, which have cross border implications, till now, has been poorly understood and incorporated. The setting up of national and regional water resources centers, even one at the international level could help build trust specially in sharing scientific information between experts and the media. Such an institution should encourage participation of professionals from the private and NGO sector in a more productive manner. Further breakthrough may be possible through increased interaction among the media representatives across the border. Journalists from Nepal should be encouraged to write and present their views in Indian papers and vice-versa. Moving Ahead: The provisions of Mahakali Treaty show that water resources technicians, bureaucrats, policy planners from both sides have learnt a lot from mistakes. They have become much mature in developing legal instruments. At a time when international water rights were essentially based on customary law for which river related to consumptive use have attempted to tackle issues pertaining to non-consumptive uses of water. Further, now we have international conventions and laws as reference frameworks for negotiation on water rights, allocations, management, planned operational measures and dispute resolution. A great deal of time and energy has already been invested in evolving a framework of cooperation in water resources. It is high time to take concrete steps to consolidate and move forward rather than continue with stale arguments. Instead of putting general and vague points view of mutual cooperation, clear ideas, explicit methods and tactical approaches will serve more in the long run. Though there are disagreements over various provisions of the Treaty, a common ground can be created by mutual consultations. Fortunately, intensive Track II level interaction has been going on between India and Nepal. Water resources experts from both countries have been working with great perseverance to create facilitating atmosphere for early implementation of Mahakali Treaty. Some early steps that can be taken to accelerate the process are: 1.Both Governments must set a target date for completion of detailed project report [DPR] including an integrated Environmental Impact Assessment (EIA) component and siting of the re-regulating dam. This can be facilitated by an early meeting of the Joint group of Experts/Secretaries and re-establishment of Joint Mahakali Project Office. 2.There is a need to build awareness about project benefits and the opportunity cost of delay at both political and people's level. The political consensus which led to the signing and ratification of the Mahakali Treaty needs to be frequently motivated and strengthened by institutionalizing a mechanism for regular political contact at the national level and between the two countries. 3.In the event of delay in implementation of Treaty, an opportunity lies for both governments to develop necessary pre investment infrastructure (like road, communications, townships and the mobilization of equipment etc.) concurrently with the completion of the DPR. 4.An early establishment of the Mahakali Commission will greatly assist in resolving difference over Treaty implementation. The commission should be a broad based body with eminent persons, including those from the Mahakali region. Its constitution will provide valuable oversight in completing the DPR and assist in resolving differences over treaty implementation. 5.Both Governments must act to implement the provision of [A] - article 2.2[a], which will make water available to Nepal from the Tanakpur barrage18. [B]-Article 1.2 of the treaty which calls for maintaining releases of water from the Sarada barrage in order to preserve the river Ecosystem19. It will help in creating mutual trust and confidence. 6.There is a further need for Nepal and India to expedite technical and other details for the supply of water to the Dodhara-Chandani Area. 7.Institutions from both sides must come forward to strengthen the track II process to supplement the government level interactions and assist in the resolution of pending issues. So it would be useful to undertake studies of international experience in cost/benefit sharing and other issues relevant to the implementation of the Mahakali Treaty. Nepal wants equal sense of participation, both in words and action, in planning and implementation of water resource projects. Such projects are based on mutual interests and reciprocities, and thus they are not client-patron situations. When two sovereign entities with highly asymmetrical size and capacities are negotiating on joint projects, attitudes and sensitivities play critical role. Indian side particularly diplomats must take care while interacting/negotiating with Nepalese counterparts. Realization of water resource projects requires diplomacy, bargaining skill and an astute vision for spin-offs. Conclusion: There is an impasse over Pancheswar Border project. It is largely a product of disagreement over interpretations of the provisions of the Treaty. Leaving too much unspecified elements in the international treaties particularly on issues like cost-benefit sharing can complicate the implementation process. It becomes even tougher in those regions which have had a history of complain and mistrust. Fortunately, negotiators from both countries agree that earlier settlement of the ambiguous/contentious issues and implementation of the project can offer immense possibilities to the people. It can contribute significantly towards water and energy security to achieve the common objectives of Nepal and India to alleviate poverty and improve the quality of life of the people living in one of the most backward regions. To realize this dream project, negotiators from India and Nepal will require positive approach, genuine understanding of each other is concern and a dialogue with an open mind, to have meaningful and fruitful cooperation. Trust and transparency not only help to get rid of the irritants but also facilitate the implementation of other agreed projects or those, under study. Further, we must not miss the larger picture that the successful water resource development and management can become the nucleus of wider cooperation in the other areas of bilateral relations. South Asian Journel- Source: http://www.southasianmedia.net/magazine/journal/11_indo-nepal_water.htm