Permanent Court of Arbitration Rules Indus Waters Treaty Remains in Force; India Rejects Ruling as Without Jurisdiction

The Permanent Court of Arbitration (PCA) at The Hague issued its merits award on August 31, 2026 in the Pakistan-initiated Indus Waters Treaty case, ruling that the treaty 'remains fully in force' and that none of India's stated grounds — including the April 2025 Pahalgam attack and subsequent cross-border terrorism concerns — could legally justify India's unilateral suspension or termination of the 1960 treaty. On the merits, the Court found India's design changes to the Kishenganga Hydro-Electric Plant (KHEP) breached the treaty, and it barred India from concreting the Ratle Hydro-Electric Plant's (RHEP) dam wall and power intake structure above specified levels until 90 days after a neutral expert issues a final decision, expected around July 2027. India's Ministry of External Affairs categorically rejected the award, stating: 'This so-called Court of Arbitration has no jurisdiction whatsoever to pronounce on India's sovereign decisions,' and reaffirmed that its decision to hold the IWT in abeyance since April 2025 'remains in force' regardless of the ruling, arguing the tribunal was constituted by the World Bank in breach of the treaty's own dispute-resolution sequencing. Pakistan welcomed the findings, with its Foreign Office saying it would give 'careful consideration to the detail of the award' and explore 'a pathway back to the parties' engagement under the treaty.' The ruling is the most significant legal development in the IWT dispute since the PCA's May 15, 2026 Supplemental Award of Competence, but carries no enforcement mechanism against India, which does not recognize the Court's authority.