Cutting water off

    • The controversy on hydropower development misses the key point that India’s main interest is water

    water_naJUL 25 – It’s a déjà vu. Suspicions and controversies surrounding Nepal-India hydropower development have resurfaced. In a scene reminiscent of the mid-90s when the controversial Mahakali treaty with India had hijacked Nepali politics, the latest Indian proposal for bilateral hydropower cooperation has caused tremors in the national polity.

    Politicians from the opposition and some also from the ruling parties have sounded alarms that Nepal stands to lose ludicrously and the Indian government has also responded to the media. Nepal’s Energy Ministry has expectedly tried to downplay the controversy which, however, refuses to die.

    All these could mean that the age-old deadlock may be here to stay and that is a bad news for both Nepal and India–although for quite different reasons. Without a deal, Nepal will not realise its long-overdue hydropower-export dream. But for India, at stake is much more than electricity; it is water. And that key issue is missing big time in the latest debate.

    Guarded draft

    Had Nepal realised that, it would not have cancelled the scheduled meeting of the Joint Committee of Water Resources (JCWR). Energy minister Radha Gyawali told the BBC Nepali service that the Nepali team was not sent to New Delhi for the routine meeting “because Prime Minister Sushil Koirala was not well.”

    Water resources experts do not understand what does that mean and why should the regular meeting wait for the prime minister to recover.

    The team was not going to sign on the dotted lines of the draft agreement after all. Or, was it?

    Veteran negotiators with the government say the JCRW team should have been actually sent to assess the Indian mind-set.

    With whatever has come out in the media as the content of the closely guarded Indian proposal, there have been more questions than answers.

    For instance, Article III (b) reportedly says: In particular, the parties shall cooperate in effective harnessing of Nepal’s hydropower potential through facilitation and speedy construction of hydroelectric power projects in Nepal either with 100 percent Indian investments or joint venture with Indian entities.

    Now, does that mean Nepal cannot develop hydroelectric projects on its own or with the help of any other country or a foreign company?

    Or, since the draft agreement does not say anything about Nepal’s own initiative or its partnership with other countries’ companies for hydropower development , does it mean the country will always have those options open for itself?

    The Indian embassy’s reaction does say “In no way does the draft constrain Nepal’s sovereign right to develop its hydropower potential.”

    It also adds: The proposal forwarded by India is a draft for discussion and would require bilateral negotiations prior to finalisation. Both sides are free to propose amendments or modifications to the draft.

    To propose amendments or modifications, you need to understand what the draft actually says. More so, when the last line of what has been published in the media as the draft proposal reads: In case of any divergence in interpretation [of the agreement], the English text shall prevail.

    For Nepal, whose official language is not English unlike India’s, preliminary discussions can be very helpful. The cancelled JCWR meeting would have been an opportunity to clarify the ambiguities and, more importantly, understand India’s water-related interests. If the Nepali side genuinely pursued that goal, that is.

    Indian interests

    The Indian establishment has long made it loud and clear that their first two concerns in Nepali waters are flood control and irrigation. Former Indian water resources minister Saif Uddin Soz told the BBC that hydropower development came only third in their interest checklist.

    Add to that the fact that India is a worryingly water-stressed country.

    Given all that, the Nepali side really needs to pursue the JCWR meet because that is the only channel to understand India’s policy towards Nepali water resources.

    If there is no such policy with New Delhi and if it is just about hydropower development , then the two countries already have an agreement on power trade signed in 1997. The Indian embassy statement also acknowledges that.

    Some Nepali hydro experts believe it was Nepal that complicated that agreement by saying it will get it ratified by the parliament.

    If it really needs to be ratified by the parliament–now doubled by the Constituent Assembly– then just do it. Instead, what Nepal did was it sent another draft proposal in 2010 with some additions like cross border grid constructions.

    Four years down the line, the Indian response arrived and with it came the flashbacks of the mid-90s when hydropower controversies held bilateral relations hostage.

    If both sides do not want a rerun of that murky episode, they need to handle the situation entirely differently this time.

    The southern neighbour has hundreds of hydroelectric projects pipelined in Arunachal Pradesh state alone and has so much electricity to produce from coal-fired plants. Not to talk about its nuclear plants ambitions.

    So, for it, the planned multipurpose hydropower structures in Nepal will not just be about electricity.

    It will mainly be about flood control, irrigation and addressing its dangerously growing water deficits.

    Testing waters

    In hydrocracy, they all are known as downstream benefits for which Nepal had been demanding payments.

    It has even been talking about asking India to pay for downstream benefits Nepal’s own storage projects like Budi Gandaki would create–high hopes indeed given India’s maintained silence on those issues all these years.

    The challenge now is to thrash out a way that will somehow find a balance between India’s water needs and Nepal’s hydropower development and export-market requirements.

    Will the Nepali side even be able to table that case?

    And will India’s newly appointed Modi-government respond unconventionally?

    The visit of the Indian foreign minister Sushma Swaraj this week may be when you could test the waters.

    Navin Singh Khadka is a BBC journalist based in London and can be reached at