The Indus River System consists of six principal rivers: the Indus, Chenab, Jhelum, Ravi, Beas, and Sutlej, traversing the territories of both India and Pakistan. This river system is vital for drinking water supply, agriculture, and electricity generation across the Indus Basin, supporting millions of people in both nations.
Following the partition of British India in 1947, the Indus River System was divided between the newly established countries. India, as the upper riparian state, controlled the headwaters of most rivers, while Pakistan’s agricultural core, particularly the Punjab plains, was heavily reliant on water flow from the eastern tributaries. Conversely, India required access to these resources to achieve its developmental goals in Punjab and Rajasthan, while also aiming for stability and normalized relationships with Pakistan.
In light of its domestic water needs, India entered into a significant water-sharing agreement with Pakistan on September 19, 1960, facilitated by the World Bank. The negotiations were deeply influenced by the disparity between India’s constructive approach and Pakistan’s maximalist demands. The World Bank’s first proposal on February 5, 1954, exemplifies this imbalance, as it required India to make substantial one-sided concessions. These included halting all planned water developments along the upper reaches of the Indus and Chenab rivers, resulting in considerable benefits for Pakistan.
Under this proposal, India was mandated to forgo the diversion of approximately 6 million acre-feet (MAF) from the Chenab River, with no water available for Indian use at Merala (now in Pakistan). India was also prohibited from developing water resources in Kutch from the river system. Despite these rigorous stipulations, India accepted the proposal swiftly, signaling its intent for resolution. In contrast, Pakistan delayed its acceptance for nearly five years, showing a preference for obstruction over cooperation.
As a compromise, the Treaty allocated India exclusive rights to the three Eastern rivers—Sutlej, Beas, and Ravi—while Pakistan received rights to the Western rivers—Indus, Chenab, and Jhelum. India was allowed certain non-consumptive uses of the Western rivers within its borders, primarily for run-of-river hydropower generation, but faced numerous design and operational restrictions. In terms of volume, the Eastern rivers allocated to India deliver approximately 33 MAF annually, while the Western rivers allocated to Pakistan yield around 135 MAF, effectively providing Pakistan about 80 percent of the total water in the system. India, thus, received 20 percent in return for relinquishing claims on the significantly larger Western rivers.
One notable aspect of the Treaty involves financial compensation. India agreed to pay approximately £62 million (equivalent to about $2.5 billion today) to Pakistan for the construction of water resource infrastructure in Pakistan-occupied Kashmir. This arrangement marked a unique situation in which the upstream nation, already ceding most of the system’s water, compensated the downstream country for the privilege of doing so.
The Treaty is characterized by structural unfairness, as it imposes unilateral and asymmetric restrictions on India. It limits the irrigated cropped area that India can develop and sets stringent caps on water storage volumes in facilities using Western rivers. India must also adhere to specific design criteria for hydropower projects on these rivers, which do not have parallel obligations on Pakistan’s side. Thus, the Treaty effectively constrains India’s resource development while ensuring guaranteed flows for Pakistan, illustrating a lopsided regulatory framework.
