Indian Foreign Minister S. Jaishankar’s upcoming visit to Nepal is poised to address the persistent challenges surrounding the Pancheshwar Multipurpose Project, a venture conceived almost three decades ago on the Mahakali River. The primary objectives of the project include electricity generation, field irrigation, and flood control. Despite being a longstanding initiative, the detailed project report (DPR) remains elusive, and the term of the team of experts assigned to finalize it is set to expire soon.
The Nepal-India Joint Commission meeting, scheduled during Jaishankar’s visit, is expected to focus on resolving the deadlock over Pancheshwar. The bilateral discussions aim to tackle crucial issues such as water sharing, quantification of benefits, and the distribution of project development costs. Attempts have been made to reduce the project’s size from the initially proposed 6,480 MW to below 5,000 MW. However, challenges persist, indicating the complexity of negotiations between the two nations.
Key points of contention include Nepal’s concession of water rights to India and the intricate cost-sharing arrangements outlined in the 1996 Mahakali Treaty. According to the treaty, project costs are to be shared proportionally based on the benefits each party stands to gain. While there is a shared entitlement to the utilization of the Mahakali River’s water, existing consumptive uses by India for irrigation complicate the calculation of costs.
The negotiations also involve considerations of unused water, with Nepal potentially ceding rights to India in exchange for the southern neighbor shouldering a greater share of the project development costs. This involves navigating the delicate balance of political decisions, considering the differing positions of major political forces within Nepal.
Despite the urgency imposed by the impending expiration of the team of experts’ term, there appears to be a lack of preparedness for a breakthrough during Jaishankar’s visit. The divergence in benefit calculations further complicates matters, with hydropower accounting for around 70%, and irrigation and flood control benefits making up the remaining 30%. Nepal aims to minimize costs associated with benefits beyond hydropower.
The intricacies of benefits distribution, particularly in irrigation and flood control, have led to disparities between the two nations. Nepal’s envisioned benefits in these areas appear modest compared to India’s, leading to disagreements over the proposed distribution outlined in the DPR. The lack of consensus indicates that the DPR may not be concluded within the existing term of the team of experts.
To address these challenges, the Pancheshwar Development Authority, comprising representatives from both countries, may need to extend the experts’ term. However, there is currently no plan for such a meeting, and the political landscape within Nepal adds another layer of complexity to the decision-making process.
In summary, the Pancheshwar Multipurpose Project remains entangled in intricate negotiations, with the visit of Indian Foreign Minister S. Jaishankar serving as a critical juncture for addressing the longstanding issues and steering the project towards fruition. The outcomes will likely depend on navigating political decisions, resolving disagreements over benefit distribution, and potentially extending the term of the experts involved in finalizing the detailed project report.
