Context

More than a month after India and Nepal signed the agreement on long-term power sharing, the two sides have not managed to make any forward movement on the stalled negotiations over the landmark Pancheshwar Multipurpose Project (PMP).

What is Pancheshwar project?

• The Mahakali or Kali River rises at an altitude of 3,600 meters in the Greater Himalaya range at Kalapani, in the Pithoragarh district of Uttarakhand.
• This river forms the natural border between India and Nepal in Uttarakhand.
  • Kalapani is near the Lipu-Lekh pass at the border between India, Nepal, and Tibet.
• The Kali river, which forms the boundary of India and Nepal, is also connected to the territorial dispute of Kalapani-Limpiadhura-Lipulekh as the river originates in the triangular area that is claimed by both countries.
• Once the Kali River descends from the Himalayan foothills and onto the Gangetic plain, at Banbasa near the town of Tanakpur, its name changes to the Sharda River.
  • he river is a part of the Ganga river system, joining the main river near the city of Madhubani.
• This river is the center of the Pancheshwar Dam.
• The Pancheshwar multipurpose hydroelectric project is to be built over the Mahakaliriver jointly by the Indian and Nepalese Governments. 
• The project involves the construction of two dams on the river Mahakali, for
  • irrigation, flood control, and;
  • generation of power for both countries
• The project is to come up near the Pancheshwar temple, 2.5 km downstream of the confluence of the Mahakali and Sarju rivers. 

Why the project is not moving ahead?

• The project is aimed at generating around 6,480 MW energy (to be divided equally between two sides), along with water for irrigation of 130,000 hectares of land in Nepal and 240,000 hectares of Indian territory, respectively.
• The project is stalled because the Indian and the Nepali sides are unable to come to a consensus on sharing of benefits.
  • While electricity is divided equally, India gets the lion’s share of irrigation and flood control benefits.
• On the other hand, Kathmandu feels water is ‘white gold’ and India should pay Nepal for it.
• India cannot accept this claim as it challenges India’s understanding of other water-based treaties, including the Indus Waters Treaty with Pakistan. 

Possible consequences

• Possibility of destruction:The project lies in areas with Seismic levels 4 to 5. If any mis-happening takes place and the dam is harmed, the destruction will be on a very heavy scale. 
• Vulnerable zone: The project has a drainage area of -12,000 sq. km, out of which -2700 sq. km lies in the glacial and periglacial zones.
• Affecting communities: Communities on both sides of the Mahakaliriver – 31,023 families, close to 50,000 people or more, will be directly impacted.
• Environmental concerns: Biodiversity loss, Floods, Loss of landscape/aesthetic degradation, Soil erosion, Deforestation and loss of vegetation cover, Surface water pollution / Decreasing water quality, and Groundwater pollution or depletion are some of the environmental issues faced by the project.