Regarding relations on trans boundary waters, particularly those shared by India and Nepal, researchers and scholars have generally been facing serious challenges due to the dearth of data on the subject, causing blurred analyses and conclusions and making it difficult to appreciate the real issues at hand. The foregoing remark may not be true anymore. Indeed, I recently completed reading ‘Chakrabyūhama Nepal Ko Jalasrot’(Water Resources of Nepal In A Labyrinth) by Dr. Dhungel, a veteran senior official in the government of Nepal; a highly revealing and spellbinding book of unique quality dealing, inter alia, with the challenges of preparing, negotiating, finalizing, and implementing Indo-Nepal treaties concerning water resources.

The Title

Although in frequent use in the sub-continent, the term ‘Chakrabyūha’ in the title of the book, due to its intrinsic meaningfulness, deserves some explaining. Simply put, ‘Chakrabyūha’ means a ‘Labyrinth’. However, ‘Chakrabyūha’, as depicted in the Mahabharata, also represents a multi-tiered combat formation that looks like a blooming disc of multiple defensive human walls. The formation begins with two soldiers standing back-to-back, with other such set of soldiers standing at a certain distance, drawing up circles and culminating in the end at a spot where the enemy is captured. Once drawn, the foremost soldiers come on either side of the enemy, engage briefly and move forward. Their place is taken up by the next soldiers on either side, who again engage the enemy briefly or move forward. In this fashion, soldiers pass the enemy and proceed in a circular pattern. By the time the rear of the formation arrives, the oblivious enemy is surrounded, at which point, the enemy realizes his captivity.

This unique term of choice in the title of the book conveys a thousand messages about winning. Hidden in the message are the confusing nature, the unclear pattern, the failed expectations, the biased team formation, the weak tactics, and the disappointing outcomes of the negotiations of Indo-Nepal water resources and energy treaties. With one term, it foretells a complicated and politically charged game of negotiations dominated by ill-faith, ill-will, and ill-intent, which one side always wins.

The Coverage

Divided into seven parts, the book, through its 49 chapters, analyses with amazing detail Nepal’s complex legal, constitutional, and administrative issues pertaining to energy and water resources development, including the trans-boundary rivers flowing from Nepal into India. In that vein, it also touches upon the diplomatic and international law intricacies involved in the finalization of agreements on trans-boundary waters confronting the issues of hydro-geopolitical complexities.

Part 1 of the book (pp11-306), a portion of which only will be the focus of this review (below), discusses the Indo-Nepal Mahakali Treaty as well as the Power Trade Agreement. Part 2 tells the story of two hydropower projects, namely the ‘Karnali-Chisapani’ and the ‘West Seti Hydro-Power’; projects certainly concerning trans-boundary rivers but not governed by any international treaty. The discussions of these two projects highlight the strategic and commercial interests of US and Australian companies (pp309-446). Similarly, Part 3 of the book (pp449-508) discusses the electricity-related legislation and relevant institutions, and Part 4 provides detail about a national institution established as a think tank on water policy matters- the Water and Energy Commission (pp511-528).

As important, the book also discusses, in Part 5, the role, interest and politics of international funding, and more importantly the role of the World Bank in the development of the water sector in Nepal (pp531-570). Finally, Part 6 focuses on the administration and functioning of Nepal’s Water Resources Ministry (pp573-646), and Part 7 on miscellaneous topics relevant to water resources development (pp649-670).

The scope of the Review

Constrained by space limitation and given the significance for international lawyers and researchers of the unique approach taken by the book in connection with the chapter on Mahakali Treaty negotiations, the scope of this review is limited to the Mahakali negotiations only. Indeed, the chapter has successfully dealt with all the interconnected phases of negotiations, with the example of the good, the bad and the ugly sides of the Mahakali Treaty negotiations between Nepal (the upper riparian) and India (lower riparian).

Indo-Nepal Mahakali Treaty

Before discussing the Mahakali treaty saga covered in the book (pp11-290), it would seem useful to set the stage of the Indo-Nepal hydro-geopolitical reality.

Nepal’s water resources comprise mainly of four main snow-fed tributaries of the Ganges - the Mahakali (called Sarada in India), the Karnali (called Ghagra in India), the Sapta Gandaki, and the Sapta Kosi - all originating in the Nepal Himalayas and joining the Ganges in the subtropical plains of India. As per estimates, these rivers contribute 45% of the annual flow of the Ganges and 70% of its dry-season flow, making Nepali tributaries the lifeblood of the fertile Indian lowlands. As important, Nepal, because of its terrain, provides the best, if not the only, option for downstream flood control and dry season augmentation.

Mainly interested in allocating unlimited volume of water to itself, India, whose ever-increasing energy requirements speak to its potential interest in Nepal, is also a consumer of energy (hydropower). But the interests of India and Nepal clash over water sharing, dam-building and exploitation, and environmental and social considerations. As a result, treaty-making and negotiations between India and Nepal have always been difficult. Nonetheless, the two countries have signed bilateral treaties to utilize shared rivers (regarding the Kosi, Gandaki and Mahakali rivers), although the geo-politics in the region has obstructed their smooth functioning.

The Play: The Periods of Negotiations

Tran boundary rivers play a significant role in determining relations between states. They not only trigger mutual interdependence, thus giving rise to confrontation on various competing issues, but also encourage riparian to develop an integrated strategy on shared resources. With this background, the Nepalese history of bilateral relations with India on trans-boundary water matters should be assessed through the periodic phases of negotiations.

The first period of negotiations on the water issue occurred between 1910 and 1920 when British India needed to harness the Sarda River (Mahakali system), which formed the western boundary between Nepal and British India, to develop irrigation in the State of Uttar Pradesh. Nepal agreed to the 1920 Sarda treaty, under which about 4,000 acres of the left bank were given to British India in exchange for an equivalent forest area (pp12-14). This agreement allowed British India to build Sarda Barrage and the right bank Sarda Canal to irrigate northern areas of India, and allocated Nepal between 3% and 4% of the dry season flow and no more than 9% of what India withdrew during wet season.

The second period of negotiations began after the independence of India from Great Britain, and the regime change within Nepal in 1951. Although not the focus of the book under review (excepting for some references), in that decade, the goals of modernization and development adopted by both nations imparted a new impetus to harnessing the tributaries of the Ganges (flowing from Nepal to India). As a result, India and Nepal signed the Kosi and the Gandak treaties which gave India a right to control the headwork on Nepali territory and, at the operational level, to agree with the water releases to Nepal. The Indian insistence on management control and refusal to allow independent assessment of downstream benefits for equitable allocation in connection with both the treaties generated much dissatisfaction in Nepal. Because of this, the relationship between the two countries on water resources has always been unsettled and tense. Also, the effects of these two treaties having been mostly negative, an inherent distrust continued to couch all future water negotiations.

The third period, which revolved around the preparation and the negotiations of the treaty on the Mahakali River (the main chapter in Part 1 of the book under review), needs to be discussed in two sub-sections: The Tanakpur Memorandum of Understanding (Tanakpur MOU or Agreement) and the Integrated Mahakali Treaty.

To further cooperation regarding the Mahakali River, the governments of India and Nepal entered the Tanakpur MOU, on December 6, 1991 (pp 15-18). It provided for the construction of an afflux bund on Nepalese territory (left afflux bund) for which the Nepalese provided 2.9 hectares of land. Unlike the Sarada Treaty, the Tanakpur MOU did not provide for an even exchange of land from India. Instead, it provided for the installation of a head regulator (main part of the reservoir regulating the water flow) at the Tanakpur Barrage with a capacity of 1,000 cusecs and required India to construct a canal to deliver 150 cusecs of water to Nepal. India was further required to provide Nepal with 10 megawatts of electricity. The Tanakpur MOU also stated that when there was an increase in the water supply at a reservoir (the Pancheshwar reservoir), the supply of water to Nepal would also be increased. The provision of water and electricity by India to Nepal was seen as a quid pro quo for providing India with its land needed to construct the afflux bund.

The Nepalese government wanted the MOU to be implemented immediately, but the deal was immediately criticized by most of Nepal's opposing political parties. The issues raised in the objections dealt primarily with a concern for Nepalese territorial sovereignty and a belief that Nepal had not benefited from the Project as much as India had. Moreover, those opposing the MOU argued that because the agreement dealt with natural resources, it fell under the articles of the Constitution and required ratification by a two-thirds majority of Parliament. A writ petition was filed at the Supreme Court, with the Prime Minister as one of the respondents, challenging the validity of the Tanakpur MOU. The petitioner maintained that the MOU should be presented to Parliament for ratification prior to its enforcement in accordance with the provisions of the Constitution. The Prime Minister, playing with semantics, argued that the instrument to give 2.9 hectares of land to India was merely an MOU, signed by the Nepalese Minister of Law and Justice and the Indian Foreign Minister, and thus was not a ‘Treaty’ subject to the Constitutional provisions on ratification. The Supreme Court issued its verdict in December 1992, and concluded that the Tanakpur Agreement was, indeed, a ‘Treaty’ that required ratification by the Parliament. It was not merely an MOU.

In hindsight, entering the Tanakpur MOU seemed like a hasty decision. The Nepalese Government either did not appreciate the legal, socioeconomic, and political ramifications involved in the issue, or decided to overlook them to appease India. The Tanakpur MOU has never formally been ratified but ironically, by the time the Supreme Court verdict was rendered, the physical work at the Tanakpur site, particularly on the Nepalese side, was already complete, thus leaving the concerned Nepalese public with disappointment.

In an attempt to placate the public with their negative experience on Tanakpur and diluting the potential complexities for future water deals on the Mahakali, the Nepalese Foreign Minister then proposed an integrated Mahakali package (pp 22). India, originally, supported it only in a lukewarm fashion, but after understanding the implicit political and technical benefits it could reap out from the materialization of an integrated deal along with an opportunity to tactically control the entire Mahakali watershed, it agreed to negotiate.

Nepal proposed a draft Treaty, and as narrated in the book, India made several corrections, completely neglecting Nepal’s position and demands on substantive matters. But in the end, on January 29th, 1996, India and Nepal signed the ‘Mahakali Treaty concerning the Integrated development of the Mahakali River including Sarada Barrage, Tanakpur Barrage and Pancheshwar Project’.

The Mahakali Treaty, it may be recalled, among other, specifies that both India and Nepal have equal entitlement to utilize the waters of the Mahakali River without prejudice to their respective existing consumptive uses. Under the Treaty both countries agree to implement a multipurpose Project–the Pancheshwar Multipurpose Project (PMP)–in accordance with a Detailed Project Report to be jointly prepared by the two countries. The Mahakali Treaty also included provisions that India would supply 350 cusecs of water for the irrigation of an area in Nepal (Dodhara-Chandani) and that a joint Indo-Nepalese commission, called the Mahakali River Commission, would be established, guided by the principles of equality, mutual benefit, and no harm to either of the countries.

Maintaining the flow and the level of water in the Mahakali River was also one of the important principles established by the Treaty. India and Nepal each agreed not to use, obstruct, or divert the waters of the Mahakali River, so as to adversely affect the natural flow and level of the river. This requirement, however, does not preclude the use of the waters of the Mahakali River by the local communities living along both sides of the river as long as such use does not exceed five percent of the average annual flow at Pancheshwar.

The Saga of Negotiations

Regardless of themes or sectors, international negotiation involves three main interconnected phases. The book under review has, indeed, judiciously depicted the internal as well as external challenges, including the lack of trust, lack of communication or deliberate miscommunication, tussle between the technical staff, bureaucrats, and political leaders, in all three stages, at times in snippet form, all quite helpful to understand the dynamics of the Mahakali negotiations.

Pre-Negotiation Phase: In general information gathering, analysis, and planning (strategic and tactical) are part of the pre-negotiation phase, during which parties set clear goals that reflect national interests, as well as realistic strategies to reach those goals. This depends, to a considerable extent, on the quality of preparations, the amount of information, and available research and analyses. This seems to have been well understood by the Nepalese side. Also, clear was their understanding of Nepal’s interests.

Much importance, according to the book, appears to have been given to deal with the process of decision making prior to negotiation. Among others, they were: (i) selection criteria for the members constituting the negotiating team, such as experience, status, and personal attributes (including technical knowledge); (ii) the focus on formal and informal relationships; and (iii) the government’s efforts to create consensus amongst the major political parties; which, actually, suffered enormously from constant double-speak of some major political parties.

Actual Negotiation Phase: The actual negotiation phase, which generally involves physical interaction and attempts to persuade, can be effective when highly specialized skills and capacities of negotiators and their command of the rules, facts, and arguments in specific negotiating areas are of high standard. These criteria, as the book reveals, were valued, but the team of negotiators suffered constantly from the different external dimensions of the environmental context of negotiations, which influenced the outcome.

The noteworthy elements, according to the book, which appear to have influenced the process of negotiation, were: (i) the protocol; (ii)the procedures and behaviors; (iii) the complexity of language, which affected the extent of reliance placed on verbal and non-verbal cues used to interpret data; (iv) the nature of persuasive arguments shown by the parties attempting to influence each other; (v) the feeling of distrust and its basis in past experience, intuition, or rules and continuance throughout the process of negotiation; (vi) the dilemma of the teams to take risk, bluff or compromise; and (vii) the attitude of each negotiating party towards the time taken for completing the process of negotiation and, most importantly, the refusal of India to record in the minutes of negotiations, numerous observations and reservations of Nepal.

Post-Negotiations and Implementation Phase: In the post-negotiations phase, generally, parties comply with their remaining commitments, and implementation starts followed by constant monitoring and supervision. But the Mahakali implementation has not been smooth.

The first major obstacle came during the process of ratification. Although the Nepalese government in power, which coordinated the negotiations, work, had consulted, and obtained support and concurrence of the political parties prior to the negotiations, after the signing of the Treaty, one major political party flip-flopped and refused to support its ratification. In addition, it imposed several conditions on the government negatively affecting the treaty already negotiated. Obviously, the conditions imposed by a political party in Nepal on its government were not acceptable to India. Hence, after several exchanges of clarifications between the government and the political party and a few direct meetings between the party and Indian government officials, the political party agreed to support its ratification. But in this futile exercise, intended to gain political mileage, a long time had passed.

The second major obstacle is the detailed project report (DPR) for the Pancheshwar itself. It was supposed to be completed within six months but has not yet been finalized. A draft DPR, prepared in accordance with the understanding reached by the Treaty was, actually, sent by Nepal, but India proposed 54 points implying changes that contradicted the understanding reached by the Treaty, and introduced several new issues, which obviously had the effect of delaying its finalization. This, certainly, conveys a message about India’s lack of interest in developing the Pancheshwar project. Its interests, it seems, were in legitimizing the Tanakpur deal and renewing the Sarda Treaty, with Pancheshwar Project as a hoax of incentive, if not simply a bait of trap.

Originality and Uniqueness

Because it is a work of a scholar with theoretical as well as hands-on experience on the matter, and who was involved in the process of treaty-drafting from the initial stage, the book is a treasure for researchers, academics, and negotiators concerned with Mahakali issues. The author tells the story not only with verve but also in convincing and illuminating detail.

The details in the book, in many instances, help researchers and academics to confirm, something that needed an authoritative confirmation: those negotiations between India and Nepal on water issues are one of the best examples of asymmetric power negotiations where the downstream country constantly influences the upstream country. Indeed, in every stage of negotiations and on all aspects, only one side’s perspective prevailed.

Several critical pieces of information, until now unknown to researchers, included in the book are no less shocking. For instance, after the ratification of the Treaty by both houses of the parliament, the text was published in the Gazette, but without the Royal Seal of Approval, something that, in Nepal’s constitutional monarchical model, was imperative for any instrument to obtain the status of the law of the land. Apparently, excluding the king, this was deliberate on the part of the government and the political parties that doubted that the king would block it. Whatever the perspectives and the political merits of the approach, this was no doubt a constitutional heresy, and a perennially questionable matter for international lawyers.

The Mahakali Treaty was already initialed by the foreign ministers of India and Nepal. But, upon India’s insistence, during a state visit by the Prime Minister of Nepal to India, an event was organized for the Treaty to be re-signed by the prime ministers of the two countries. Apparently, with these high-profile signatories, India wanted to convey a message to the world that the Tanakpur issue (that had received much negative publicity) had been resolved satisfactorily. Also interesting is the brief account that, at the signing event, a mistake was found in the treaty (that changed the meaning of the understanding reached), which was later corrected through an exchange of letters. Thus, although organized to score a political point, the event turned out to be a boon in disguise.

Another interesting snippet in the book is that during the whole process of preparing and negotiating the Mahakali Treaty, Nepal never proposed to specify the source-location of the Mahakali river. This detail was critical as the East of that point would be the territory of Nepal. The Treaty negotiators opted to remain opaque and referred to the Mahakali as a border river. There were many high-level visits by Nepalese leaders and officials, but none seem to have thought to try to specify the source, a deliberate omission intended to avoid fueling the already existing border problem with India. The imperative of pragmatism of concluding the Mahakali Treaty may have dominated this approach, but the confusion created by the lack of specification remains costly and thorny matter for Nepal, particularly because a large area on its Western border has been practically occupied by India.

In addition to useful citations and footnotes, the book includes an extensive list of bibliographical information and an annex with the policies, legal instruments, and administrative decisions of the governments of Nepal and India, all relevant to Nepal’s water resources development (pp671-927). The primary and secondary sources (documents and instruments) included in the book are extremely useful for researchers dealing with water resources management-related legal, administrative and policy issues. More importantly, the book has a seminal value for international lawyers involved in the study of negotiations of water-related treaties.

Conclusion

Dr. Dhungel’s book is of highly insightful and path breaking nature. It is the story of Nepal’s water and energy related treaty-making along with an account of people, the beliefs they had, the postures they adopted, the influence they made and the intellectual tools and resources they mobilized. The author should be commended for his painstaking survey and analysis of the subject matter, and for including all the primary and secondary sources therein, which not only significantly enriches the understanding of the Indo-Nepal trans-boundary water relations, but also undoubtedly constitutes a valuable contribution to the literature on the law of international watercourse, in addition to furthering multi-dimensional research works on the topic.