Neutral Expert Decision on Kishenganga and Ratle Hydroelectric Projects/किशनगंगा और राटले जलविद्युत परियोजनाओं पर न्यूट्रल एक्सपर्ट का निर्णय:

Why in news ? A World Bank-appointed neutral expert has backed New Delhi’s position on the framework to resolve certain disputes between India and Pakistan on Kishenganga and Ratle hydroelectric projects.

Background on Indus Waters Treaty (IWT):

• Signed in 1960: Ensures equitable distribution of water between India and Pakistan.
• River Allocation:
• India: Unrestricted access to Eastern Rivers (Sutlej, Beas, Ravi).
• Pakistan: Exclusive rights to Western Rivers (Indus, Jhelum, Chenab).
• Dispute Resolution Mechanism: Article IX provides a graded system involving bilateral discussions, Neutral Expert, or Court of Arbitration.

India’s Projects and Pakistan’s Objections:

• Kishenganga Project: Located on Kishenganga River (Jhelum tributary).
• Ratle Project: Situated on Chenab River.
• Objections by Pakistan: Cited technical issues with dam design and compliance with treaty provisions.

Neutral Expert’s Decision:

• India’s Stand Vindicated: Neutral Expert affirmed competence to address seven differences concerning Kishenganga and Ratle projects.
• Compliance with IWT: Upheld that Neutral Expert is the appropriate forum for resolving differences under Paragraph 7 of Annexure F.

India’s Position:

• Commitment to Treaty: India remains committed to preserving the sanctity and integrity of the IWT.
• Rejection of Parallel Proceedings: India does not recognize the Pakistan-backed Court of Arbitration as it contravenes the treaty provisions.
• Proactive Engagement: India continues to participate in Neutral Expert proceedings to ensure disputes are resolved within the treaty framework.

Pakistan’s Actions:

• Court of Arbitration Demand: Pakistan unilaterally withdrew its request for a Neutral Expert in 2016 and sought adjudication through the Court of Arbitration.
• Violation of IWT Mechanism: This action disregarded the treaty’s prescribed resolution hierarchy.

Recent Developments:

• January 20, 2025: Neutral Expert affirmed competence to address technical differences.
• India’s Notice to Pakistan:
• August 2024: India sought a review of IWT under Article XII (3).
• January 2023: India called for treaty modification to address emerging challenges.

Significance of the Decision:

• Recognition of India’s Position: Ensures disputes are resolved within treaty provisions without external influence.
• Strengthened Governance: Sets a precedent for adhering to graded mechanisms under IWT.
• Focus on Development: Allows India to proceed with hydroelectric projects vital for energy generation while respecting treaty obligations.

 About Permanent Court of Arbitration (PCA) :

The Permanent Court of Arbitration (PCA) is an intergovernmental organization established to provide a forum for resolving disputes between states, state entities, intergovernmental organizations, and private parties. It is one of the oldest institutions for international dispute resolution, headquartered in The Hague, Netherlands.

Key Features of the PCA:

Establishment:

• Founded in 1899 at the First Hague Peace Conference, which was convened to promote international arbitration and peaceful resolution of disputes.
• Governed by the 1899 Hague Convention for the Pacific Settlement of International Disputes, revised in 1907.
• Jurisdiction:

• Handles a wide range of disputes, including those related to international law, sovereignty, territorial boundaries, maritime disputes, environmental issues, and investments.
• Membership:

• Open to all states. Currently, it has 122 member states, including India and Pakistan.
• Member states are parties to one or both Hague Conventions of 1899 and 1907.
• Structure:

• Administrative Council: Supervises the PCA’s administration and budget.
• International Bureau: Provides administrative support for arbitrations.
• Panel of Arbitrators: Each member state nominates up to four arbitrators to the panel.
• Flexible Dispute Resolution Mechanisms:

• Offers arbitration, mediation, conciliation, and fact-finding for dispute resolution.
• Parties can choose the rules, laws, and arbitrators that apply to their case.
• Facilities and Services:

• PCA provides infrastructure and legal expertise for resolving disputes.
• Located in the Peace Palace in The Hague, which is also home to the International Court of Justice (ICJ).

Comparison with Other Bodies:

1. PCA vs. ICJ

• PCA: Focuses on arbitration and caters to a broader range of parties, including non-state actors.
• ICJ: Only hears disputes between sovereign states and issues binding judgments.

1. PCA vs. ICSID (International Centre for Settlement of Investment Disputes)

• PCA handles disputes beyond investment cases, such as territorial and environmental issues.
• ICSID focuses exclusively on investment disputes under the World Bank framework.

Significance of PCA in International Law:

1. Promotion of Peaceful Dispute Resolution: Provides a neutral and flexible platform for settling disputes through peaceful means.
2. Customizable Arbitration: Parties can tailor proceedings to their specific needs, unlike rigid court-based mechanisms.
3. Precedent Setting: PCA rulings and awards contribute to the development of international law.
4. Environment and Human Rights: Increasingly addresses disputes involving environmental protection and human rights.

Examples of Cases Handled by PCA:

1. South China Sea Arbitration (Philippines vs. China): Resolved maritime disputes in the South China Sea (2016).
2. India vs. Pakistan (Indus Waters Treaty): Addressing technical differences on Kishenganga and Ratle hydroelectric projects.
3. Bangladesh vs. India: Resolved a maritime boundary dispute in the Bay of Bengal (2014).