Stories
India's Indus Squeeze: Assessing the Suspended Treaty and $100 Billion Cost
- •India suspended the Indus Waters Treaty in April 2025 following the Pahalgam attack, linking water access to Pakistan ending its support for cross-border terrorism.
- •While Pakistan has felt diplomatic and minor winter flow pressures, its infiltration activities and legal challenges have not changed its fundamental conduct.
- •India's primary loss stems from decades of underdevelopment on western rivers, costing an estimated $100 billion in unrealized hydropower and irrigation potential.
- •Upcoming dam projects like Kiru, Kwar, and Ratle will increase India's storage capacity and give it the capability to impose meaningful winter water costs by 2028-29.
- •Experts argue India's strategy should combine defensive infrastructure development with a clear, published doctrine for managing river flows as a strategic deterrent.
Key Questions Answered
India placed the Indus Waters Treaty in abeyance on April 23, 2025, following a terrorist attack in Pahalgam that resulted in the murder of 26 people, asserting that blood and water cannot flow together until Pakistan credibly and irrevocably abjures its support for cross-border terrorism.
On August 31, 2026, a Court of Arbitration constituted under the treaty ruled that the agreement remains in force. However, India categorically rejected this ruling, stating that the body has no jurisdiction to pronounce on India's sovereign decisions and confirming that its suspension of the treaty remains in force.
Pakistan experienced immediate pressure, with its water secretary writing to New Delhi multiple times requesting a reconsideration. While India cannot yet impose sustained scarcity, actions such as opening Baglihar's spillways caused drops in winter flows at the Marala barrage during Pakistan's wheat season.
