As Egypt is said to be the gift of the Nile, Pakistan is the gift of the Indus. Of the thirty-seven million acres of land irrigated by canals from the Indus River and its tributaries, in 1947 obout thirty million acres were in Pakistan - an area equal to the irrigated lands in Egypt and Sudan. The Indus and its major tributaries rise in or beyond the Himalayas and flow through Indian-held Kashmir or India. Partition gave India a stranglehold over the rivers flowing south into Pakistan. In 1948, India decided unilaterally to cut off supplies to the canals flowing from headwords under its control, ignoring Pakistan's rights under international law. It also embarked on the construction of the Bhakra Dam on the Sutlej, in order to divert the entire water supply of the river.
In 1950, Pakistan proposed arbitration, but India refused. As David Lilienthal, former chairman of the Tennessee Valley Authority, wrote in an article: 'No armies with bombs and shellfire could devastate a land so thoroughly as Pakistan could be devastated by the simple expedient of India's permanently shutting off the source of waters that keep the fields and people of Pakistan green. In 1952, World Bank President Eugene Black offered his good offices for a solution of the dispute that would provide India additional supplies of water without damage to Pakistan, which the two countries accepted. Negotiations over the highly technical issues took eight years to resolve. The Indus Waters Treaty was signed on 19 September 1960. It allocated the waters of the three eastern rivers (Ravi, Beas, and Sutlej) for use by the India, and the waters of the western rivers (Indus, Jhelum, and Chenab) for use in Pakistan, except for (a) domestic and non-consumptive uses of the river waters in the areas under Indian control, and (b) for agriculture, subject to specified limits.
The compromise conceded to Indian what it wanted, but the World Bank raised the requisite funds for the construction of two large dams at Mangla on the Jhelum and Tarbela on the Indus and 400 miles of link canals from the western rivers in Pakistan to replace the loss due to diversion of waters of the eastern rivers by India. (Three of the seven link canals carry ten times as much water as the Thames,and twice as much as the Potomac.) Of the estimated expenditure of $1.3 billion on replacement works, the treaty required India to pay $170 million, while the United States contributed over $500 million and the rest was donated largely by Australia, Britain, Canada, Germany, and New Zealand.
The Indus Waters Treaty was also farsighted in anticipating problems that might arise in interpretation and implementation of the complex agreement. World Bank experts in law, economics, construction, and engineering foresaw as many contingencies as were likely to arise, so that the treaty provides a self-executing mechanism for their peaceful resolution in a professional manner. Ind the first place, the Permanent Indus Commission, comprising high-level technical representatives of the two sides, has the responsibility to resolve differences of interpretation and ensure smooth implementation. In case the Commission is unable to agree on a 'question'of interpretation, the matter can be taken up at the level of government; and if governments also cannot agree, the 'difference'can be referred to a 'neutral expert'to be appointed by the parties or, if they fail to agree, by the World Bank. The decision of the neutral expert is binding. If the difference does not fall in the mandate of the neutral expert or the neutral expert rules that it should be treated as a 'dispute', it has to be submitted to a court of arbitration whose award is final.