I. INTRODUCTION
In May 2010, Pakistan instituted proceedings against India in the matter of the Indus Water Kishenganga under the dispute settlement procedure of the 1960 Indus Water Treaty (IWT).Footnote 1 The dispute related to India's construction of the Kishenganga Hydro-Electric Project (KHEP) and the subsequent diversion of the Kishenganga/Neelum River such that it would reach Pakistan via a different tributary. Pakistan objected to the project for a number of reasons, primarily because the diversion would affect Pakistan's Neelum-Jhelum Hydro-Electric Project (NJHEP) (which relied on the natural flow of the Kishengagnga/Neelum). Pakistan requested the Court of Arbitration to answer the following two questions: (1) was India's planned diversion of the Kishenganga/Neelum into another tributary in conformity with its obligations under the 1960 IWT (the ‘first dispute’)? (2) was India entitled under the IWT to diminish the reservoir level of a run-of-river plant (including but not limited to the KHEP) below dead storage level (DSL) in circumstances other than an unforeseen emergency (the ‘second dispute’)?Footnote 2
On 19 February 2013, the tribunal delivered a Partial Award in which it decided both disputes. It found that India was entitled to divert water from the Kishenganga/Neelum for the purposes of power generation by the KHEP; however, that right was not unlimited. Under customary international law, India was obliged to maintain a minimum level of water flow to mitigate ecological harm. The tribunal deferred its determination of this minimum flow to a Final Award rendered in December 2013, in which it decided that the minimum flow could not fall under 9 cubic metres per second (cumecs) of water.Footnote 3 Both parties have claimed victory in the case.Footnote 4
This article critically analyses the Kishenganga Partial Award. Section II briefly introduces the disputes' factual context, while section III discusses the Order on Interim Measures. Section IV analyses the tribunal's decision and interpretative methodology, highlighting the selective use of interpretative techniques. Section V briefly discusses the tribunal's Final Award, while section VI explores the decision's implications for international environmental law and the law of non-navigational uses of international watercourses (hereinafter the law of watercourses). Although the decision contributed positively to reinforcing various principles of international environmental law, it undermined the principle of ‘equality of right’—a fundamental principle underlying the law of watercourses—by implying that the de facto superiority of upstream States (based on their geographical position) translated into a de jure superiority under customary international law.
II. FACTUAL CONTEXT
The Indus system of rivers and their tributaries rise in the Himalayas, flowing through Indian-controlled Jammu and Kashmir to Pakistan. India is upstream on the Indus, while Pakistan is downstream.Footnote 5 The present dispute relates to India and Pakistan's divergent interpretations of the IWT in relation to the KHEP, a project initiated by India to provide Indian-administered Jammu and Kashmir with hydroelectricity.Footnote 6 The IWT was concluded in 1960 between India and Pakistan (and the World Bank) in a very particular historical context and divides the waters of the Indus system of rivers between the two States in a unique manner. Negotiations on the IWT were prompted by the 1948 ‘canal waters dispute’, in which the Government of East Punjab (in India) cut off the water supply to West Punjab (in Pakistan). The IWT did not apportion the waters of the Indus River between the parties. Rather, entire rivers within the Indus system were assigned to each State; three Eastern Rivers (the Sutlej, Beas and Ravi) went to India and three Western Rivers (the Indus, Jhelum and Chenab) went to Pakistan.Footnote 7 The IWT allowed India to make restricted use of the Western rivers, including the construction of new run-of-river plants, provided that any pre-existing agricultural or hydroelectric uses by Pakistan were not adversely affected.Footnote 8
The KHEP is an Indian project located on a tributary of the Jhelum, one of the Western rivers. This tributary is known as the ‘Kishenganga’ in India and the ‘Neelum’ in Pakistan (the ‘Kishenganga/Neelum River’). The KHEP was originally designed as a storage plant then reconfigured to constitute a run-of-river plant.Footnote 9 Although there is no agreed definition of a run-of-river plant, it is generally the case that this type of plant utilizes the river's flow rather than water storage to generate hydropower. The KHEP operates by diverting water through a system of tunnels from the Kishenganga/Neelum to the Bonar Nallah, another tributary of the Jhelum. The water then flows back into the Jhelum through Wular Lake.Footnote 10 Run-of-river plants are governed by IWT Article III(2)(d) and Annexure D.
Pakistan has planned another hydropower project in Pakistani-administered Jammu and Kashmir, the NJHEP. By diverting the river from its natural course, Pakistan has argued that the KHEP will decrease the flow of water downstream, reducing the NJHEP's power generating capacity. Footnote 11 The parties disagree as to whether the NJHEP existed prior to the KHEP and therefore enjoyed protection under the IWT.
III. ORDER ON INTERIM MEASURES
On 6 June 2011, Pakistan requested interim measures to restrain India from proceeding with the construction of the KHEP in a way that would prejudice the final solution and prevent the restoration of the status quo ante.Footnote 12 The tribunal temporarily stayed construction of ‘permanent’ aspects of the KHEP pendente lite, possibly for the first time ever in an inter-State arbitration.Footnote 13 It later decided in its Partial Award that India could proceed with the project (albeit with important modifications).Footnote 14
Paragraph 28 of Annexure G provides that either of the parties may request interim measures if they are necessary to safeguard its interests, avoid prejudice to the final solution, or avoid aggravation of the dispute.Footnote 15 The tribunal accepted Pakistan's argument that the ICJ's jurisprudence on provisional measures, based on Article 41 of its statute, was not dispositive; it based its decision on paragraph 28 as lex specialis.Footnote 16 It regarded neither ‘urgency’, ‘imminence’, nor ‘irreparable injury’ as necessary conditions for interim measures.Footnote 17 However, in spite of the broad scope of paragraph 28, the tribunal followed recent ICJ jurisprudence by addressing the ‘plausibility’ of Pakistan's case.Footnote 18 Since paragraph 28(b) provides that ‘the specification of … interim measures shall not be construed as an indication of any view of the Court on the merits of the dispute’,Footnote 19 the tribunal emphasized that its decision in no way affects its views on the merits.Footnote 20
Although the interim measures ordered were not to the extent requested by Pakistan, the tribunal ordered India to temporarily halt construction of certain permanent elements of the KHEP that were calculated to prevent the full restoration of the water flow to its natural channel. This was intended to avoid ‘foreclosing, delaying the implementation of, or rendering disproportionately large the cost of particular remedies that the Court may choose to order’.Footnote 21 The tribunal excluded other aspects that did not present a significant risk of prejudice (such as the temporary obstruction of the river and the construction of the power-house facility and bypass tunnel), while emphasizing that this would proceed at India's own risk.Footnote 22 It also provided for periodic joint inspection of the dam site to monitor compliance with its Order.Footnote 23
IV. THE KISHENGANGA PARTIAL AWARD: A CRITICAL ANALYSIS OF THE TRIBUNAL'S METHODOLOGY
The Kishenganga Partial Award was decided primarily on the basis of the law of treaties, specifically the interpretation of relevant provisions of the IWT. Although the tribunal made only very general references to the principles of treaty interpretation, specifically Articles 31(1) and (4) of the Vienna Convention on the Law of Treaties (VCLT),Footnote 24 it integrated the VCLT's principles throughout its reasoning, albeit inconsistently. According to VCLT Article 31(1), ‘a treaty shall be interpreted in good faith in accordance with the ordinary meaning to be given to the terms of the treaty in their context and in the light of its object and purpose’. The International Court of Justice (ICJ) has stated that this provision constitutes customary international law.Footnote 25 Interpretation can be objective (based on the ordinary meaning of the text), subjective (based on the intention of the parties) or teleological (based on the treaty's ‘object and purpose’).Footnote 26
Article 32 VCLT provides that recourse may be had to a Treaty's travaux préparatoires and the circumstances of its conclusion, but only as a supplementary means and in order to ‘confirm the meaning resulting from the application of article 31’, or in cases where the meaning is ambiguous or ‘manifestly absurd’. If the meaning of the text is clear, there is no room to rely on supplementary means of interpretation. Another important principle of interpretation is ‘effectiveness’, which has two aspects: first, all provisions of a treaty must be considered as significant in expressing the intended meaning. In other words, an interpretation that leads to the text being ineffective cannot be accurate. The second aspect is that a treaty should be read as a coherent whole, with all its provisions aiming towards a particular end. This aspect of the ‘effectiveness’ principle operates as part of the ‘object and purpose’ test (an interpretation should not render a text ineffective in achieving the treaty's ‘object and purpose’). Because the ‘object and purpose’ test is vague, scholars have urged caution in the application of the ‘effectiveness’ principle in its second aspect.Footnote 27
Although there is arguably no hierarchy between the elements of Article 31, the ICJ has generally prioritized textual (objective) interpretation.Footnote 28 In its commentary to the Article, the ILC has stated that ‘the text must be presumed to be the authentic expression of the intentions of the parties; and that, in consequence, the starting point of interpretation is the elucidation of the meaning of the text’.Footnote 29
VCLT Article 31(3)(c) also requires States to take into account ‘any relevant rules of international law applicable in the relations between’ them during the course of interpretation. Incorporating customary international law can also take place through mutual agreement or through treaty stipulation. This was the approach adopted by the parties in the Pulp Mills case.Footnote 30
Alternatively, customary international law may be incorporated through so-called ‘dynamic’ or ‘evolutive’ treaty interpretation.Footnote 31 This technique is based on examining the terms and concepts in a treaty, which sometimes indicate the possibility of an evolving meaning. Footnote 32 Although these two methods are not identical, ‘the underlying approach is very similar’.Footnote 33 The ICJ used ‘dynamic’ interpretation in Gabčíkovo-Nagymaros,Footnote 34 justifying this approach on the principles of ‘good faith’, ‘reasonableness’, and the original intention of the parties (a subjective form of interpretation which is nonetheless based on the actual text).Footnote 35
Less frequently, international tribunals have employed teleological interpretation, which is based on the treaty's object and purpose.Footnote 36 This approach is still grounded in Articles 31 and 32 VCLT, but gives priority to the ‘object and purpose’ of the treaty, its context and the principle of effectiveness. Under this approach, which was adopted by the arbitral tribunal in the Iron Rhine arbitration, the aim of interpretation is to give effect to the treaty's ‘object and purpose’, which constitute the ‘outer limits’ of interpretation.Footnote 37 The treaty in question was a boundary treaty concluded in 1839 between Belgium and The Netherlands. It also provided for a right of transit across Dutch territory for a railway linking Belgium and Germany. Despite the absence of dynamic wording, the tribunal found that the treaty's ‘object and purpose’ required modernization and adaptation of the railway, particularly since the treaty was not limited in time.Footnote 38 In order to interpret the treaty in this manner, the tribunal defined its ‘object and purpose’ very broadly such that modernization and adaptation of the railway could be considered central to the treaty's aim.Footnote 39 Although the treaty's terms were static, it was interpreted in a manner that would take into account recent technical developments in order to give effect to this broad ‘object and purpose’.
The teleological approach is controversial in that it may be viewed as a revision of the treaty's text, reading into it obligations it does not contain (thus undermining State consent). It does not simply constitute evolutionary interpretation based on the ‘open-endedness’ of a particular term or concept within a treaty, but rather what is known as purposive or policy-based interpretation that is contextual rather than textual.Footnote 40 Because a treaty's ‘object and purpose’ is indeterminate, purposive interpretation is necessarily subjective, meaning that the parties’ obligations are unpredictable over time.Footnote 41
The Kishenganga tribunal set out the IWT's ‘object and purpose’ by adopting a middle ground between the parties' divergent positions. India defined the ‘object and purpose’ as the optimum utilization and cooperative development of the watercourse, while Pakistan claimed it was to guarantee the undiminished flow of water to Pakistan.Footnote 42 The tribunal provided a negative definition of the ‘object and purpose’. It stated that the IWT granted Pakistan priority in the Western Rivers and India priority in the Eastern Rivers, establishing Pakistan's unrestricted use of the Western Rivers with some exceptions, including India's right to generate electricity from power plants situated on these rivers. Any interpretation of the IWT that allowed Pakistan to unilaterally ‘curtail the ability of such Indian Plants to operate would [therefore] subvert an important element of the object and purpose of the Treaty’.Footnote 43
The tribunal oscillated in different parts of its Partial Award between the subjective, objective and teleological approaches to interpretation. This selective methodology allowed the tribunal to assert jurisdiction (by adopting a textual interpretation of the IWT's territorial scope) and deliver a decision on the merits that split the difference between the parties, while securing some positive environmental outcomes. Nonetheless, the danger of such inconsistency is that the methodology on which the tribunal's legal reasoning is constructed may become instrumental to the desired outcome. This section discusses the tribunal's application of this selective methodology throughout the three main parts of the Partial Award.
A. Territorial Questions
While the KHEP is located in Indian-administered Jammu and Kashmir, the areas allegedly harmed by it are exclusively located in Pakistan-administered territory. According to India, Pakistan was not entitled to invoke the IWT with respect to territories under Pakistan's de facto control as opposed to its de jure sovereignty.Footnote 44 India claimed that it had explicitly rejected an attempt to bring Jammu and Kashmir under the IWT's ambit by omitting a Pakistani-proposed provision extending the IWT's scope to all territories under the parties' ‘actual control’. Pakistan, in turn, argued that the parties' rights and obligations under the IWT extended to the entire area of the Indus system of rivers, including territories under the parties' factual control, also invoking part of the negotiating history.Footnote 45
In analysing the parties' claims, the tribunal first examined the IWT's negotiating records, which it found inconclusive. It then discussed the preamble, which referred to the parties' desire to achieve the ‘most complete and satisfactory utilisation of the waters of the Indus system of rivers’ without qualification or distinction between waters passing through contested and uncontested territory. Having found no provision that excludes water passing through disputed territory, the tribunal inferred that the parties’ intent was to extend their rights and obligations under the IWT to both Indian-administered and Pakistan-administered Jammu and Kashmir.Footnote 46 The lack of a specific textual provision was therefore taken as a clear indication of the drafters’ intentions. This is significant, as limiting the IWT's applicability to undisputed territories would have precluded the tribunal's exercise of jurisdiction.
B. First Dispute
For the purposes of this analysis, the first dispute will be divided into the following three questions:
1. Is there an outright prohibition of inter-tributary transfers under the IWT?
Pakistan invoked IWT Articles III(2) and IV(6) in support of its claim that the IWT prohibited the diversion of the Jhelum. Article III(2) provides that India will ‘let flow all the waters of the Western Rivers’ and ‘not permit any interference with these waters’. It then admits four exceptions, allowing India to make use of the waters for (a) domestic use; (b) non-consumptive use; (c) agricultural use (subject to Annexure C), and (d) hydroelectric power generation (subject to Annexure D). In its chapeau, Article III(2) provides that India's uses of the Western Rivers is restricted ‘in the case of each of the rivers, The Indus, The Jhelum and The Chenab, to the drainage basin thereof’.Footnote 47
According to Pakistan, India is under a positive obligation to ‘let flow’ the waters and a negative obligation to ‘not interfere’ with its natural flow. These are the two ‘fundamental principles underlying the Treaty’, and they translate into a right for Pakistan to enjoy the unrestricted natural flow of the water. As a canon of interpretation, exceptions to these principles should be narrowly construed.Footnote 48
Adopting a strictly textual reading of Article III(2), Pakistan argued that the four exceptions to the ‘let flow’ obligation were restricted to uses of the Western rivers that were limited to their ‘drainage basins’. In other words, India could not utilize a tributary of the Jhelum to generate hydropower for use in areas outside that river's drainage basin. The negotiating history of Article III(2) indicated that the language of the provision had been relaxed, describing hydropower generation as a ‘use’ rather than an ‘entitlement’ and restricting this ‘use’ to the relevant drainage basin. Pakistan referred to this as the ‘drainage basin restriction’.Footnote 49 Whereas Annexure C included an exception from the ‘drainage basin restriction’ in respect of India's agriculture uses, no such exception was incorporated into Annexure D for hydropower generation.Footnote 50 Pakistan thus relied on a textual (objective) interpretation of Article III(2), supported through reference to the negotiating history.
On the other hand, India argued that the obligation under the IWT to ‘let flow’ the waters was not absolute and that Pakistan had misinterpreted the IWT's travaux and the drafters’ intentions. It maintained that throughout the negotiations, the parties’ objective had been to achieve optimum utilization of the Indus system of rivers— including through the generation of hydropower—rather than to preserve the uninterrupted flow of the waters.Footnote 51
With respect to the ‘drainage basin restriction’, India argued that this restriction governed the waters used for the generation of hydropower, rather than the actual electricity generated. In other words, the IWT required power to be generated within the drainage basin, but that power could be transported elsewhere.Footnote 52 India also argued that Pakistan had not previously objected to other Indian projects whose electricity was transported outside the relevant drainage basin.Footnote 53
The tribunal could have relied on this last argument to base its decision on estoppel or subsequent practice. Instead, it dealt with this issue in a cursory manner without examining the arguments of the parties or analysing the relevant provision, its context and negotiating history in any measure of detail. It stated briefly that there was ‘no indication in the Treaty that a geographic restriction on the use of electricity … was intended’, concluding that Article III(2) restricted ‘what India may do with the waters of the Western Rivers, and not with the products that may be generated from their use’.Footnote 54 This interpretation renders the phrase ‘restricted … in the case of the rivers … to the drainage basin thereof’ superfluous, which disregards the principle of ‘effectiveness’.
By contrast, when analysing the parties’ interpretations of IWT Article IV(6), the tribunal adopted a rather literal interpretation of the text. Article IV(6) provides that:
Each Party will use its best endeavours to maintain the natural channels of the Rivers, as on the Effective Date, in such condition as will avoid, as far as practicable, any obstruction to the flow in these channels likely to cause material damage to the other Party (emphases added).
According to Pakistan, the ‘material damage’ (loss of natural habitat and ecosystem functions) caused by diversion of the Kishenganga/Neelum from its natural channels constituted a prima facie violation of Article IV(6).Footnote 55 India, on the other hand, argued that the ecological harm invoked by Pakistan was irrelevant to the dispute, as the principles of international environmental law found no explicit mention in the IWT, and therefore fell outside the scope of the tribunal's jurisdiction.Footnote 56
In its evaluation of the parties’ competing claims, the tribunal did not address the question of whether environmental harm constituted ‘material damage’. Instead, it relied on a literal interpretation to avoid this question. First, the tribunal found that Article IV(6) concerned the ‘maintenance of the physical conditions of the channels’, rather than ‘the volume and timing of the flow of water in these channels’. It was therefore irrelevant to the issue of inter-tributary transfers.Footnote 57 The tribunal stated that the word ‘channels’ should be defined in accordance with its ‘common usage’, which denoted the ‘bed of the river, which may or may not be filled with water’. It accepted India's interpretation of Article IV(6) as embodying an obligation to maintain the physical paths of the river rather than the volume of water flowing through them. This interpretation was arguably confirmed by the IWT's travaux préparatoires.Footnote 58
The tribunal also found that Article IV(6) could not bar the construction of works specifically allowed under Annexure D. The question of the permissibility of the KHEP therefore turned on its conformity with Annexure D (which deals specifically with run-of-river plants) rather than Article IV(6).Footnote 59
2. Does the KHEP meet the conditions for the permissibility of diversion?
The tribunal also relied on textual interpretation to answer this question. Paragraph 15(iii) of Annexure D provides that:
where a Plant is located on a Tributary of The Jhelum on which Pakistan has any Agricultural use or hydro-electric use, the water released below the Plant may be delivered, if necessary, into another Tributary but only to the extent that the then existing Agricultural use or hydro-electric use by Pakistan on the former Tributary would not be adversely affected (emphases added).Footnote 60
Pakistan's argument was based on three premises. First, the KHEP did not constitute a run-of-river plant governed by Annexure D, but rather a new type of hydropower plant operating through damming and permanently diverting the river. Second, paragraph 15(iii) did not permit the large-scale, permanent diversion envisioned by the KHEP. It only authorized occasional deliveries of waters into other tributaries. Third, the term ‘necessary’ should be interpreted according to the meaning of necessity developed under international environmental law. Pakistan referred to the Iron Rhine arbitrationFootnote 61 and the ICJ's decisions in Gabčíkovo-Nagymaros Footnote 62 and Pulp Mills Footnote 63 to support the claim that States were under an obligation to ensure that activities taking place within their jurisdictions did not harm the environment of other States, and that adverse impacts on the environment that did not meet the strict, objective requirements of necessity and proportionality were contrary to customary international law.Footnote 64 India should therefore have taken a number of measures, including a more comprehensive Environmental Impact Assessment (EIA) as well as adopting a precautionary approach to its activities.Footnote 65
India disagreed with this interpretation, asserting that Annexure D did indeed envision inter-tributary transfers.Footnote 66 It also argued that the term ‘necessary’ should be interpreted according to its ordinary meaning, as a reference to the particular purpose for which the measure was ‘required’. In the case of the KHEP, this was the generation of hydropower. It rejected Pakistan's attempt to import principles of environmental harm into the meaning of the term ‘necessary’ and denied the status of the precautionary principle as customary international law.Footnote 67
The tribunal held that the term ‘run-of-river plant’—as the subject of a specific treaty definition—must be given a ‘special meaning’ rather than its ‘ordinary meaning’ (VCLT Article 31(4)). There was therefore no doubt that the KHEP was a run-of-river plant according to Annexure D's formal definition.Footnote 68 By stipulating that ‘the water released below the Plant may be delivered, if necessary, into another Tributary’, the tribunal found that the plain meaning of paragraph 15(iii) allowed for inter-tributary transfers. The tribunal was ‘not convinced’ that the provision envisioned only occasional, rather than permanent diversion of a tributary.Footnote 69
On the question of ‘necessity’, the tribunal based its view on a detailed analysis of the IWT's preparatory works. It concluded that necessity should be determined by reference to the particular purpose for which the water was being diverted (in this case the generation of hydroelectric power),Footnote 70 thereby rejecting Pakistan's attempt to associate the term ‘necessity’ with indispensability or urgency. It held that the only meaning that should be ascribed to the term ‘necessity’ was its ordinary meaning, and that any special meanings were irrelevant. Based on this textual analysis, the Court concluded that in the case of the KHEP, diversion of the waters was ‘necessary’ to generate hydroelectric power on the scale contemplated by India.Footnote 71
3. Is the KHEP prohibited because it adversely affects an existing Pakistani use?
The tribunal once more changed its approach, departing from a strict textual interpretation to a more subjective and teleological approach when examining the question of ‘existing uses’. Paragraph 15(iii) of Annexure D allows for diversion only to the extent that Pakistan's ‘existing’ agricultural and hydroelectric uses would not be ‘adversely affected’. According to Pakistan's interpretation, a use of the river was to be considered an ‘existing use’ if it existed at the time of operation of a new Indian project (the so-called ‘ambulatory approach’).
India, on the other hand, argued that the term ‘existing use’ signified a ‘historic use’; it had to have already existed when India first communicated to Pakistan its intention to proceed with a new project.Footnote 72 To consider otherwise, India contended, would be to allow any intended use by Pakistan to prevent the development of a new use by India. India proposed determining a ‘critical date’ that would act as a cut-off between existing and potential uses (the so-called ‘critical date approach’). This ‘critical date’ was, in India's view, the date at which India communicated to Pakistan its firm intention to establish a new project.Footnote 73 After this date, any use developed by Pakistan would not constitute an ‘existing use’, even if the proposed Indian project was not yet operational.
Pakistan and India differed as to whether the NJHEP constituted an ‘existing use’ entitled to protection. While Pakistan argued that it had informed India of its intention to construct the NJHEP in 1988 (ie before the KHEP was in operation),Footnote 74 India claimed that Pakistan had not actually revealed any concrete plans until 2008 (after India had already established its ‘firm intention’ to proceed with the KHEP in 1994).Footnote 75
The tribunal first examined the ordinary meaning of the text, finding that the formulation of paragraph 15(iii) supported the ‘ambulatory approach’, according to which ‘existing uses’ were those that existed at the time of operation.Footnote 76 However, it ignored the clear meaning of the text. Because other provisions in Annexure D established that Pakistan had a right to object to new Indian projects prior to their construction,Footnote 77 the tribunal found that the IWT's context implied that an ‘existing’ Pakistani use was one that was already in place before the construction of a new Indian project had begun.
The tribunal then analysed the implications of each of Pakistan's ‘ambulatory approach’ and India's ‘critical date’ approach. It found that the adoption of the ‘ambulatory approach’ would practically deprive India of its right to generate hydropower under the Treaty. It would require India to abandon its plans every time Pakistan subsequently decided to use the waters, leading to lack of stability and a high potential for waste of resources. No investor would be willing to finance an Indian project under such conditions.Footnote 78 A strict adherence to the ‘ambulatory approach’ was therefore irreconcilable with the context of paragraph 15(iii) and the IWT's ‘object and purpose’.Footnote 79
As for India's ‘critical date’ approach, the tribunal was confronted with the difficulty of determining when a ‘firm intention’ to construct a new project had crystallized. It therefore referred to another provision: paragraph 9 of Annexure D, which required India to provide full information regarding a project's design at least six months prior to initiating construction.Footnote 80 The tribunal found that it would not be possible to rigidly define a ‘critical date’ that signified an ex ante crystallization of a ‘firm intention’ given the complexity of large-scale infrastructure projects. Instead, the tribunal could determine a ‘critical period’ during which a range of facts (such as tenders, governmental approvals, initiation of construction) indicated ‘firmly’ that a proposed project would proceed.Footnote 81 It found that the relevant ‘critical period’, fell between 2004 and 2006, concluding that the NJHEP could not be considered an ‘existing use’ at the time as Pakistan had not demonstrated a clear commitment to construct it.Footnote 82
Although the tribunal claimed it had adopted a middle ground between the ‘ambulatory’ and ‘critical date’ approaches in light of the IWT's attempt to balance between the interests of both parties,Footnote 83 in effect, it adopted a slightly modified version of India's ‘critical date’ approach. While it found that the ‘ordinary meaning’ of the provision supported Pakistan's ‘ambulatory approach’,Footnote 84 it elected to override this clear meaning to give effect to the ‘object and purpose’, including through prioritizing economic considerations (which are inherently subjective and irrelevant to the provision's context).Footnote 85 Significantly, however, the tribunal attempted to mitigate the consequences of this approach through affirming that India's right to divert the water was not absolute and that Pakistan still retained the right to receive a ‘minimum flow’ of water by virtue of customary international lawFootnote 86 (see section IV).
C. Second Dispute
In the second dispute, the tribunal relied on the principle of ‘effectiveness’ to assess the permissibility of drawdown flushing, India's preferred technique for sediment removal. Drawdown flushing permits the removal of sediment from a reservoir by releasing water through low-level outlets in the dam, allowing for more effective expulsion of accumulated deposits. This necessitates the reduction of the water level in the reservoir to below dead-storage level. According to Pakistan, the release of sediment would also have an adverse impact on the downstream environment. Because drawdown flushing affects the uninterrupted flow of water, Pakistan argued that it defeated a central aim of the IWT and was therefore impermissible.Footnote 87
Pakistan's arguments were based on a textual interpretation of Annexure D, which prohibits the depletion of the reservoir level of a run-of-river plant below DSL except in unforeseen emergencies.Footnote 88 In addition, Pakistan argued that paragraph 2(a) of Annexure D did not foresee the use of dead storage for ‘operational purposes’ such as sediment removal, emphasizing that effective sediment control could be achieved through other techniques.Footnote 89
India, on the other hand, considered drawdown flushing the most effective technique for sediment removal and hence for its meaningful exercise of the right to generate hydropower under the IWT.Footnote 90 It distinguished between ‘operational purposes’ and ‘maintenance’, contending that drawdown flushing constituted a ‘maintenance’ purpose that was not prohibited under Annexure D. India also argued that the ‘state-of-the-art’ concept, enshrined in the IWT through use of the term ‘sound and economical design’, entailed that the IWT had to be interpreted in light of modern technological advancements. Since sediment management through drawdown flushing was necessary for the project's sustainability, India argued that it was consistent with ‘sound and economical design’ and therefore with the IWT's terms.Footnote 91
The tribunal considered different methods of sediment management and their environmental impacts, which depended heavily on expert evidence presented by both parties.Footnote 92 It agreed with Pakistan's claim that sediment control could not be classified as an ‘unforeseen emergency’. It also rejected India's claim that a distinction between ‘operation’ and ‘maintenance’ could justify its use of drawdown flushing.Footnote 93
Although the ordinary meaning of the text ruled out the permissibility of drawdown flushing, the tribunal still based its decision on what it considered ‘contextual aspects’ (ie the availability of other methods of sediment control) and effectiveness.Footnote 94 It stated that the IWT ‘should not condemn the KHEP or other Indian hydro-electric projects on the Western Rivers to an impractical and uneconomically short project life’.Footnote 95 Interestingly, the tribunal ‘accept[ed] that the [IWT] is to be interpreted in light of technological developments’; however, this could not override ‘the essential equilibrium on water use and flow agreed to by the Parties’.Footnote 96 Consequently some methods considered ‘state-of-the-art’ would remain unavailable to India. The tribunal therefore relied on teleological interpretation (based on effectiveness) to rule out drawdown flushing and order the redesign of the KHEP, although a textual interpretation would have yielded a similar result.
V. FINAL AWARD
In December 2013, the Kishenganga tribunal issued its Final Award (FA) on the issue of the minimum flow of water to be preserved downstream of the KHEP. It requested both parties to provide information on historical flow estimates at the KHEP site, the Line of Control and the NJHEP site, as well as the impact of a range of proposed flows on power generation at both dams and on the environment.Footnote 97 The parties presented very divergent views on the impact of different minimum flows. The essence of this difference was India's claim that the KHEP had priority in right over the NJHEP and the two projects therefore could not be treated equally. This argument was based on what Pakistan described as the ‘incorrect assumption’ that the Partial Award prioritized India's needs over Pakistan's.Footnote 98 Pakistan also attempted to make a case for protecting its future agricultural uses.Footnote 99 Finally, the parties differed as to the extent of water flow required for considerations of environmental protection.Footnote 100
Both parties, particularly Pakistan, submitted a wide range of scientific evidence to support their respective positions. India argued that any flow greater than 4.25 cubic metres per second (cumecs) (which is the value recommended by India's Ministry for Environment and Forests) would seriously affect the economic viability of the KHEP, basing its analysis on minimum flow scenarios between 3.94 and 10 cumecs. Pakistan, on the other hand, evaluated the impact of releases between 10 and 100 cumecs, arguing that a minimum flow of less than 80 cumecs would cause significant loss of power generation capacity at the NJHEP and that a flow below 10 cumecs would significantly modify the ecological condition of the Kishenganga/Neelum.Footnote 101 India accused Pakistan of presenting this ‘constellation of environmental material’ for reasons of advocacy, implying that the real aim was to maximize the flow of water for Pakistan's uses rather than to protect the riverine environment.Footnote 102 Similarly, Pakistan criticized India's presentation of scientific evidence as ‘selective’.Footnote 103
The tribunal, in line with the Partial Award, maintained the KHEP's priority over the NJHEP, which resulted in a somewhat conservative estimate of the minimum flow.Footnote 104 After assessing the parties’ methodologies, it concluded that an approach based exclusively on environmental considerations would indicate a flow of 12 cumecs, while considering the effects on the NJHEP would suggest even higher flows.Footnote 105 The tribunal therefore emphasized that the effective operation of the KHEP overrode these two considerations, as: (1) avoiding adverse effects on the NJHEP was not required by the IWT, and (2) environmental considerations could not override all other considerations particularly the balance of rights and obligations enshrined in the IWT, including India's right to divert the waters.Footnote 106 The tribunal was not entitled to substitute customary international law in place of the treaty, and hence environmental considerations could not become the overriding concern. It proceeded to fix the minimum flow at 9 cumecs, as this would reduce the capacity of the KHEP by only 5.7 per cent and therefore would not affect its economic viability. Either party was entitled to seek reconsideration of this figure after seven years.Footnote 107
VI. IMPLICATIONS FOR THE LAW OF WATERCOURSES AND INTERNATIONAL ENVIRONMENTAL LAW
Although the Kishenganga decision is based on interpreting the IWT, this does not preclude it from contributing to the development of general international environmental law and the law of watercourses. The vast majority of cases decided by international courts and tribunals relating to the uses of watercourses are based on bilateral treaties between the parties to a dispute,Footnote 108 just as in the present case. These cases are widely recognized as constituting important State practice.Footnote 109 Because the relevant bodies of law are vague and indeterminate, ‘arbitral and judicial decisions play an important role in [their] development through recognition and further refinement’.Footnote 110 Additionally, disputes concerning the uses of watercourses are heavily fact-intensive and technical, often involving a great deal of scientific evidence. The Kishenganga tribunal was particularly well suited to this challenge due to its unique composition, which included both highly qualified engineers as well as eminent jurists on its bench.Footnote 111
Although this dispute concerned a major transboundary watercourse, the Partial Award made no mention of the 1997 UN Convention on the Non-Navigational Uses of International Watercourses (UNWC).Footnote 112 This is particularly surprising since the tribunal was presided over by Stephen Schwebel, while India was represented by Stephen McCaffrey, two of the ILC's former Special Rapporteurs on the law of watercourses. Although the UNWC only obtained the requisite number of ratifications to enter into force in May 2014, it has been referred to by the ICJ and is considered by some authorities to be widely reflective of customary international law.Footnote 113 Moreover, nowhere in either the Partial or Final Awards is any reference made to the principle of equitable utilization, considered a principle of customary international law and a cardinal principle of the law of watercourses.Footnote 114
Although the tribunal failed to justify this omission, it is possible that it considered the IWT a form of lex specialis that displaced general customary international law. This is in keeping with Article 3 UNWC, which provides that ‘nothing in the present Convention shall affect the rights or obligations of a watercourse state arising from agreements in force’. However, this argument is undermined by the text of paragraph 29, Annexure G, which empowered the Court to incorporate customary international law in its interpretation of the IWT (which indeed it did in relation to its discussion of environmental protection).
Despite the foregoing, the tribunal's decision did address a number of important issues within the context of interpreting the IWT, which are capable of broader generalization.
1. Defining existing uses
The law of watercourses is primarily concerned with striking a balance between conflicting interests of riparian States, particularly between existing and potential uses of a watercourse. The extent to which prior and existing uses are protected under customary international law is a matter of much controversy.Footnote 115 The adoption of the UNWC further obfuscated this issue, particularly since Article 6 stipulates that both ‘existing and potential uses’ of a watercourse are to be taken into consideration when determining equitable use. The UNWC did not clarify what consequences would ensue from a conflict between ‘existing’ and ‘potential’ uses. Moreover, it did not define either category or determine how to distinguish between them.
The International Law Association (ILA's) 1966 Helsinki Rules, provided in Article VIII(2)(a) that ‘a use that is in fact operational is deemed to have been an existing use from the time of the initiation of construction directly related to the use or, where such construction is not required, the undertaking of comparable acts of actual implementation’.Footnote 116 Article VIII therefore did not adopt an ‘ambulatory approach’ to existing uses, but neither was it based on the intention to construct. It took a middle position by linking the existence of a particular use to the actual initiation of construction.
Although the Kishenganga tribunal made no mention of the Helsinki Rules, its decision affirms this approach. It found that during the relevant critical period (2004–06), Pakistan had not yet demonstrated a clear commitment to construct the NJHEP, unlike India, which had already initiated construction of the KHEP.Footnote 117 Because India had ‘coupled intent with action’ it had a stronger priority in right.Footnote 118
2. The dialectic between rights of usage and no harm
The dichotomy between past and potential uses is reflected in the dialectic between the no-harm and equitable use principles. Nowhere in the decision does the tribunal refer to the riparian States’ equitable use; however, the Partial Award refers to India's ‘significant rights’ of usage in the following controversial dictum:
Given the significant rights enjoyed by India as the upstream riparian under customary international law, as well as the natural advantages enjoyed by the upstream riparian, the Court recognizes, in view of the acute need both of India and Pakistan for hydro-electric power, that India might not have entered into the Treaty at all had it not been accorded significant rights to the use of those waters to develop hydro-electric power on the Western Rivers (emphasis added).Footnote 119
This is the first time that an international adjudicatory body has stated that upstream States enjoy ‘significant rights’ under customary international law, implying that their rights are superior to those of downstream States (over and above their advantaged geographical position). This notion threatens to revive the now discredited theory of ‘absolute sovereignty’ of upper riparians over water originating in their territories (the Harmon doctrine). This principle, along with its antithesis known as ‘absolute territorial integrity’,Footnote 120 has long been replaced by the principles of ‘community of interest’, enunciated by the Permanent Court of International Justice (PCIJ) in the River Oder case and endorsed by the ICJ in Gabčíkovo-Nagymaros and ‘limited territorial sovereignty’. These principles affirm the legal equality of all riparian States and exclude any preferential privilege of one riparian in favour of another.Footnote 121 They are premised on the notion that legal restrictions exist on a State's use of an international watercourse and that each riparian State has the right to utilize such waters within the limits of the corresponding duty not to cause harm to co-riparians.Footnote 122 The Kishenganga tribunal did not state the authority for its contention and failed to elaborate on the content or implications of the ‘significant rights’ purportedly enjoyed by the upstream State. However, the tribunal's inclinations seemed to have informed its decision to employ ‘effectiveness’ and teleological interpretation to deprive the NJHEP of protection as an ‘existing’ Pakistani use. This could be viewed as a revision of the actual terms of the IWT.Footnote 123
The tribunal also missed an important opportunity to reaffirm the principle of no harm. India referred to a dictum of the 1957 Lake Lanoux arbitral tribunal, which stated that there was no rule ‘in the generally accepted principles of international law … which forbids a State, acting to protect its legitimate interests, from placing itself in a situation which enables it in fact, in violation of its international obligations, to do even serious injury to a neighbouring State’.Footnote 124 This dictum, when read in context, clearly indicates that the tribunal was referring to potential danger of misuse by France and not actual harm. In fact, France had offered Spain monetary compensation for loss of water volume, which the latter rejected. The project was then modified so that France would return to Spain an amount of water equivalent to the quantity diverted. Although there was no harm to Spain, it did not accept this arrangement for fear that France would acquire complete control over the water's flow.Footnote 125 The Lake Lanoux tribunal stated that Spain ‘could … have claimed that her rights had been impaired’ had it argued ‘that the works would bring about an ultimate pollution of the waters of the Carol or that the returned waters would have a … characteristic which could injure Spanish interests’.Footnote 126 In the Kishenganga arbitration, Pakistan claimed that the diversion envisioned by the KHEP would cause actual environmental degradation, which distinguishes it from the Lake Lanoux dispute. The Kishenganga tribunal, however, completely avoided discussing this issue.
Nonetheless, the tribunal did not make the KHEP immune from environmental concerns.Footnote 127 Although it adopted ‘effectiveness’ and teleological interpretation to conclude that the NJHEP was not a protected use under the IWT, it relied on customary international law to incorporate notions of environmental harm and hence fix the minimum flow at 9 cumecs in its Final Award. This decoupling of the two types of harm, namely harm to existing uses and harm to the environment (in the absence of a specific provision to that effect) is significant.
The notion that the two categories of harm are separate is implicit in both the Helsinki Rules and the UNWC. Under the Helsinki Rules, there is no general provision on harm. Harm to past and existing uses is addressed in the factors relevant to equitable sharing, while environmental harm falls mainly under Article X of Chapter 3 (on ‘Pollution’). This provision requires States to prevent any new pollution that causes substantial injury to another State, and provides that the State causing such pollution would be liable for compensation in the event of injury. Under the UNWC, Part IV deals distinctly with protection, preservation and management of a watercourse and contains a specific provision—Article 21—that requires States to prevent, reduce and control pollution resulting in significant harm to other watercourse States or to their environment. Importantly, pollution resulting in harm that is not significant is permitted. The UNWC therefore did not go as far as endorsing Stephen McCaffrey's proposal as Special Rapporteur to treat ‘the effects of pollution differently from other kinds of harm’, and accord primacy to the no harm rule over equitable utilization in matters involving pollution.Footnote 128 In fixing the minimum flow at 9 cumecs, the Kishenganga tribunal adopted an approach that is similar to the UNWC's (albeit with respect to the environmental effects of decreased water flow rather than pollution).
The tribunal categorically rejected the notion that India is unrestricted in its ability to use the waters for hydropower generation, even if this could be inferred from the text of the IWT. In an important dictum, the tribunal stated that:
It is established that principles of international environmental law must be taken into account even when (unlike the present case) interpreting treaties concluded before the development of that body of law. The Iron Rhine Tribunal applied concepts of customary international environmental law to treaties dating back to the mid-nineteenth century, when principles of environmental protection were rarely if ever considered in international agreements and did not form any part of customary international law. Similarly, the International Court of Justice in Gabčíkovo-Nagymaros ruled that, whenever necessary for the application of a treaty, ‘new norms have to be taken into consideration, and … new standards given proper weight’.Footnote 129
In this dictum, the tribunal expressed its support for so-called ‘evolutionary’ or ‘dynamic’ treaty interpretation. However, the technique it actually relied on was the incorporation of customary international law through reference to paragraph 29 of Annexure G.
The tribunal subsequently referred to the Trail Smelter arbitrationFootnote 130 for evidence of the ‘foundational customary international environmental law’ duty to avoid transboundary harm and Gab číkovo-Nagymaros as evidence of a customary international law principle requiring States to take environmental protection into consideration when designing projects with transboundary effects.Footnote 131 It referred to Pulp Mills in support of the principles of sustainable development, due diligence, duty of vigilance and prevention (throughout the life of the project) and the requirement to undertake an Environmental Impact Assessment. It also referred to the Iron Rhine arbitration in support of the ‘principle of general international law’ mandating a duty to prevent or mitigate significant harm.Footnote 132 The tribunal concluded that by virtue of customary international law, the KHEP was subject to a minimum ‘environmental’ flow, which would mitigate significant trans-boundary environmental harm.Footnote 133 This minimum flow was fixed at 9 cumecs, which would only minimally affect the power-generation capacity of the KHEP, and would be open to reconsideration after a period of seven years.Footnote 134
VII. CONCLUSION
Because many of the principles of the law of watercourses and international environmental law are vague and indeterminate, the only manner in which they can be given concrete meaning is through elaboration by international courts and tribunals. In the present case, the tribunal's contribution is undermined by its selective interpretative methodology, which makes it impossible to identify any consistent pattern in its reasoning. Although the tribunal prioritized textualism in order to assert its jurisdiction, it later oscillated between textual, subjective and teleological interpretative techniques rather than adopting a coherent, methodical approach to treaty interpretation. The tribunal's decision also undermines the principle of equality of right by implying that upstream States have more extensive rights than downstream States under customary international law.
In spite of these deficiencies, the Kishenganga decision, on balance, may have had some positive implications. Its key contribution is clarifying, for the first time in an international judicial decision, the modalities for distinguishing between existing and potential uses of a watercourse, a matter left ambiguous by Article 6 UNWC. The decision also reaffirmed some important international environmental law principles, such as the duty of due diligence, prevention and continuous environmental impact assessment, and confirmed the customary international law status of the obligation to avoid transboundary harm.
