The India-Pakistan water dispute over one of South Asia’s most consequential agreements has entered a new phase.
On August 31, a five-member Court of Arbitration constituted under the 1960 Indus Waters Treaty issued an Award on the Status of the Treaty and a separate Order on Interim Measures concerning India’s Ratle Hydroelectric Plant. Both decisions were unanimous. The Permanent Court of Arbitration in The Hague serves as the secretariat to the Court of Arbitration rather than being the tribunal itself.
The Court concluded that the Indus Waters Treaty remains fully in force despite India’s April 2025 decision to place it “in abeyance.” It examined possible legal grounds for suspending or terminating the agreement and found no basis that would allow India to unilaterally set the treaty aside.
But this Hague arbitration decision went beyond treaty interpretation.
The Court also imposed interim restrictions concerning the Ratle Dam, an 850 MW hydroelectric project under construction on the Chenab River. India cannot advance concrete construction beyond specified levels on parts of the dam wall and power-intake structure until 90 days after a separate Neutral Expert issues a decision on the relevant treaty-compliance questions. That decision is expected around July 2027.
That does not mean construction of the entire Ratle Hydroelectric Plant has been halted. The order restricts specific works while the Neutral Expert process continues. India participates in that separate treaty mechanism while rejecting the authority of this Court of Arbitration.
India’s response was categorical.
New Delhi rejected the decisions and described the Court of Arbitration as an illegally constituted body that India has never recognised. The Indian government maintains that the tribunal has no jurisdiction over its sovereign decisions and says its pronouncements will have no effect on Indian projects. Crucially, India also says its decision to hold the Indus Waters Treaty in abeyance remains in force.
This confrontation did not begin with the August 31 rulings. The Court ruled in 2023 that it was competent to hear Pakistan’s case despite India’s objections. After India placed the treaty in abeyance, the Court issued another Supplemental Award on its competence in June 2025. India continued to reject the arbitration process.
The stakes are enormous because of what the treaty governs.
Signed in 1960 after negotiations facilitated by the World Bank, the Indus Waters Treaty broadly allocated the Ravi, Beas and Sutlej for India’s use while giving Pakistan primary rights over the Indus, Jhelum and Chenab, subject to specified Indian uses. The Ratle project therefore sits on one of the western rivers central to the treaty framework.
That makes Pakistan water security inseparable from this legal confrontation. Roughly 80% of Pakistan’s cultivated land depends on water from the Indus system. The rivers at the centre of the dispute consequently affect irrigation, food production and the livelihoods of millions, not merely diplomatic relations between two governments.
India placed the treaty in abeyance in April 2025 following the Pahalgam attack in Indian-administered Kashmir, which killed 26 civilians. India linked Pakistan to cross-border terrorism, while Pakistan denied involvement. Relations subsequently deteriorated into a brief military confrontation between the two nuclear-armed neighbours in May 2025.
Pakistan has welcomed the August 31 decisions as support for its position that India cannot unilaterally suspend the treaty. India, meanwhile, continues to reject the authority of the tribunal that issued them.
That leaves India-Pakistan relations facing an extraordinary water and legal standoff:
The Court says the Indus Waters Treaty remains binding. Pakistan expects India to honour it. India says the Court itself has no authority over its actions.
And with the dispute now touching physical construction on the Chenab River, the next question is no longer simply who won the legal argument.
It is whether the ruling can change what actually happens on the Indus river system.
By Shizza Umer
Sources
• Al Jazeera: India rejects Hague court order to restore Indus waters pact with Pakistan
• Washington Post: Hague arbitration panel says India must honor water-sharing treaty with Pakistan
• NPR: With Indus Waters Treaty in the balance, Pakistan braces for more water woes
• PIB India: Ratle Hydro Electric Project details
• News on Air (India): India rejects supplemental award, Court of Arbitration
