Cash-strapped Pakistan foots India's bill, bears New Delhi's share of Indus Waters Treaty arbitration costs

New Delhi: With India putting the Indus Waters Treaty (IWT) in abeyance and staying off all ongoing proceedings at the Court of Arbitration and the Neutral Expert levels since the April 22, 2025, Pahalgam terror attack, it is Pakistan which is solely bearing the entire cost of the proceedings, including India's share, to keep the process alive, ET has learnt. The amount goes well beyond $600,000, it is learnt.

Factor this. India has been boycotting the Pakistan-piloted Permanent Court of Arbitration (PCA) proceedings since 2023 as concurrent Neutral Expert proceedings was underway. However, Pakistan once again moved it after India's decision to put the IWT in abeyance in May 2025. PCA went on to declare itself competent to examine the issue in June 2025 and held that IWT did not allow for 'unilateral' suspension of the treaty.

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Ever since, the PCA has held at least eight hearings -- all boycotted by India.

The average cost for PCA proceedings is learnt to be around $300,000 for each country. It is gathered that Pakistan is currently bearing the full cost of these proceedings -- paying India's share as well -- taking its total bill to over $600,000.

The PCA, which India considers illegal, in its August 8, 2025 'Award on Issues of General Interpretation of the Indus Waters Treaty', has observed that India did not participate in the constitution of the court or its meetings and "it has not advanced any of the funds requested by the court toward the costs of the arbitration".

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In its controversial May 15, 2026 order on 'maximum pondage' favouring Pakistan, PCA has said that it "reserves the costs of the proceedings to be awarded by the court pursuant to Paragraph 26 of Annexure G to the Indus Waters Treaty 1960 for determination in the Court's Final Award.

As far as the Neutral Expert proceedings are concerned, India did participate in these until the Pahalgam terror attack, following which it formally sought a pause in proceedings.

ET gathers that India also fully paid its due share for all Neutral Expert proceedings until July 2025. However, India kept away from the subsequent Fourth Meeting of the Neutral Expert with the parties held during 17-21 November 2025 followed by the fifth meeting in May 2026 among others, with Pakistan paying the costs involved, it is learnt.