VZCZCXRO7556
PP RUEHBC RUEHDBU RUEHDE RUEHKUK RUEHLH RUEHPW RUEHROV
DE RUEHNE #0752/01 0451302
ZNY CCCCC ZZH
P 141302Z FEB 07
FM AMEMBASSY NEW DELHI
TO RUEHC/SECSTATE WASHDC PRIORITY 3020
INFO RUCNISL/ISLAMIC COLLECTIVE
RUEHBJ/AMEMBASSY BEIJING 5292
RUEHLM/AMEMBASSY COLOMBO 8796
RUEHKA/AMEMBASSY DHAKA 8875
RUEHIL/AMEMBASSY ISLAMABAD 2051
RUEHBUL/AMEMBASSY KABUL 4014
RUEHKT/AMEMBASSY KATHMANDU 9506
RUEHLO/AMEMBASSY LONDON 2755
RUEHMO/AMEMBASSY MOSCOW 1343
RUEHKO/AMEMBASSY TOKYO 4442
RUEHCG/AMCONSUL CHENNAI 8861
RUEHCI/AMCONSUL KOLKATA 8579
RUEHBI/AMCONSUL MUMBAI 8033
RUEAIIA/CIA WASHDC
RUCNDT/USMISSION USUN NEW YORK 3738
RHEHNSC/NSC WASHDC
RUEIDN/DNI WASHINGTON DC
RHHMUNA/CDR USPACOM HONOLULU HI
RUEHGV/USMISSION GENEVA 6081
RUCPDOC/DEPT OF COMMERCE WASHDC
RHHJJPI/PACOM IDHS HONOLULU HI
RHMFISS/HQ USSOCOM MACDILL AFB FL
RHMFISS/HQ USCENTCOM MACDILL AFB FL
RUEKJCS/SECDEF WASHDC
RUEKJCS/JOINT STAFF WASHDC

C O N F I D E N T I A L SECTION 01 OF 03 NEW DELHI 000752 
 
SIPDIS 
 
SIPDIS 
 
E.O. 12958: DECL: 02/13/2017 
TAGS: PREL PGOV KWWT ECON PBTS ENRG ECIN KISL PK IN
SUBJECT: BOTH SIDES VICTORIOUS IN BAGLIHAR VERDICT, INDIA 
PERHAPS MORE SO 
 
NEW DELHI 00000752  001.2 OF 003 
 
 
Classified By: A/PolCouns Atul Keshap, Reason 1.5 (B,D) 
 
¶1.  (C) Summary.  The World Bank-appointed neutral expert 
announced his ruling on February 12 regarding the 
controversial Baglihar dam project, which both Pakistan and 
India claimed as a victory.  Several specifications contested 
by Pakistan are being addressed, but the overall design of 
the dam is intact and India is ready to move forward toward 
completion and operation in one year's time.  The ruling is 
not only final and binding, but also establishes that India 
is in the clear to proceed with other projects in the region 
that involve waters granted to Pakistan under the 1960 Indus 
Waters Treaty.  The Indian press praised the verdict as a 
victory and vindication after more than a decade of 
disagreement.  End Summary. 
 
 
Design Largely Acceptable, Just Needs Tweaking 
--------------------------------------------- - 
 
¶2.  (U) World Bank-appointed neutral expert Professor Raymond 
Lafitte, a Swiss civil engineer, released his final and 
binding decision on February 12 regarding the Baglihar dam to 
Pakistani and Indian representatives in Bern, Switzerland. 
Lafitte cleared the 450-MW Indian hydroelectric project on 
the Chenab River with only minor alternations, which India 
said in a statement "all arise from calculations and not from 
(conflicts with the) basic principles" of the 1960 Indus 
Waters Treaty.  Pakistan had contended that the 4.5-meter 
freeboard (the vertical distance between the top of the dam 
and the level of the contained water supply) should be only 
0.84 meters tall, but Lafitte found a 3-meter height in 
order.  The new, shorter design will stand over 140 meters 
tall, total, and conform to the standards of the 
International Commission of Large Dams.  The neutral expert 
ruled in India's favor that the dam could have 32.56 million 
cubic meters of pondage (the dam's water storage capacity), 
an amount lower than India's design of 37.50, but far greater 
than the 6.22 advocated by Pakistan.  He also allowed a 
higher rate for the design flood than Pakistan wanted in 
order to account for calculation uncertainties and possible 
climate change.  Finally, Lafitte agreed with India's 
approach to deal with the silt that accumulates from the 
sediment-rich Himalayan water.  India uses an outlet method 
that did not exist in 1960 and will not interfere with the 
level of flow of the Chenab's waters, according to the 
neutral expert's decision and in keeping with the Indus 
Waters Treaty.  The dam is scheduled for completion by early 
2008 with a total cost of around $1 billion (estimates vary 
from Rs. 40 to 50 billion). 
 
 
Media Reaction: India Scores A Victory, Vindication 
--------------------------------------------- ------ 
 
¶3.  (SBU) Many news outlets on Tuesday reflected a sense of 
victory and vindication for India.  Multiple newspapers noted 
that the changes recommended by Lafitte are "marginal" and 
that the dam's electricity output is not expected to be 
affected by the verdict.  The Hindu reported that India had 
claimed a "moral victory," and that there was "visible 
relief" in the Indian Water Resources Ministry.  An article 
in The Pioneer claimed that the dam, outfitted with an 
anticipated second 450-MW power station, could "rejuvenate" 
Jammu and Kashmir's economy, "which is in doldrums after 
 
NEW DELHI 00000752  002.2 OF 003 
 
 
years of strife."  The Times of India had one of the most 
strongly-worded articles, saying that India can "happily live 
with" the verdict, which denies "Pakistan any excuse to 
quibble."  The article gloated, "This is the second time in 
recent years that India has been given a thumbs up in a 
dispute involving Pakistan," the earlier incident being the 
downing of a Pakistani surveillance aircraft by India in 1999. 
 
 
Decision Has Set Precedent 
-------------------------- 
 
¶4.  (C) Former High Commissioner to Pakistan G. Parathasarthy 
told PolOff on February 13 that this decision "set 
precedents" for future construction of dams affected by the 
Indus Waters Treaty.  "A lot of projects that were held up 
are now possible," he said.  In particular, he noted that 
India can now proceed with its Kishenganga dam project in 
Jammu and Kashmir, the subject of a similar disagreement 
between Pakistan and India.  "If the Pakistanis object, then 
we'll take the issue to the World Bank again," he said.  "The 
independent expert made clear what is acceptable under the 
Indus Waters Treaty and what isn't."  In the past, India had 
offered to build the Baglihar dam lower (as the verdict 
commands) and thus the same outcome could have been reached 
"15 years earlier" had Pakistan chosen to cooperate with, and 
not contest, India's intentions, Parathasarthy noted.  He 
also compared the Baglihar dam project with the older Salal 
dam project, another dam in Jammu and Kashmir.  In the case 
of the Salal dam, India designed and constructed the dam with 
Pakistani sediment-related specifications in mind.  As a 
result, he claimed that the dam became "silted-in" in under 
20 years.  Given Monday's verdict, India will likely not make 
the same mistake twice. 
 
 
Important That Islamabad Feels It Won, Too 
------------------------------------------ 
 
¶5.  (C) The ruling reflected several of Pakistan's objections 
to the dam, as mentioned in paragraph 2.  PolOff spoke with 
Hindustan Times editor Manoj Joshi on February 13, who 
emphasized that the verdict has so far been well received in 
Pakistan.  "If you can work out solutions for both capitals, 
then that's the way to do it," he said.  Joshi finds that 
water is an "emotional issue" in South Asia, particularly 
given the current protests in Karnataka in response to the 
Cauvery Tribunal verdict.  It would have been unproductive 
had the decision been India's victory alone, and disagreement 
over the issue would have been dragged "on and on."  He 
summarized, "If India says one thing, the Pakistanis will 
disagree."  That there was an international observer in this 
case makes the verdict palatable to the Pakistanis.  Joshi 
pointed to the Kutch boundary tribunal of the 1960s, in which 
another international arbiter decided a largely technical 
dispute between the two nations.  Although not part of the 
Composite Dialogue process, Joshi believes that the Baglihar 
decision may have positive--though indirect--implications for 
other areas of contention in Indo-Pak relations. 
 
 
Comment: A Workable Outcome 
--------------------------- 
 
¶6.  (C) Comment:  The fact that both India and Pakistan are 
 
NEW DELHI 00000752  003.2 OF 003 
 
 
claiming victory is a positive outcome to one problem that 
has plagued relations for 15 years.  As our Indian 
interlocutors frequently remind us about Indo-Pak relations, 
it may have been a wise decision for the U.S. not to have 
intervened in this issue since things very well could have 
transpired in a less mutually applauded way and the U.S. 
could have taken the blame.  As it is, neither side is 
casting blame on Prof. Lafitte, the World Bank, the U.S., or 
any other third-party entity.  The verdict may also mitigate 
India's distrust in international arbiters, allowing for 
their potential use in addressing other problems.  Since the 
450-MW hydroelectric station is expected to come on-line in 
one year's time, it should also provide a boon to the unmet 
energy needs of Jammu and Kashmir (estimated at 2000 MW) as 
well as India at large.  That India has the green light to 
complete and/or build similar dams on other rivers throughout 
Jammu and Kashmir is a fact likely not lost on anyone in 
energy-starved New Delhi.  End Comment. 
 
¶7.  (U) We coordinated this cable with Embassy Islamabad. 
MULFORD