Use of bankruptcy methods for resolving interprovincial water conflicts over transboundary river: Case study of Indus River in Pakistan

Abstract

Sustainable transboundary water governance is often challenged by conflicts between agents, which necessitates the design of cooperative and self‐enforcing alternatives to facilitate equitable water distribution. A pervasive and critical problem related to many transboundary rivers is that the total allocation or demand of riparian states is usually much more than that of the total available water. This problem is a major cause of disputes, both nationally and internationally. A key challenge concerns how to allocate the available water among riparian states with competing and often conflicting needs under an uncertain supply–demand gap. To address this pervasive allocation problem related to transboundary rivers, the bankruptcy method is used. The bankruptcy method distributes water among riparian states when their total demand exceeds the total available water. We investigate the utility of this method in the Indus River – a river that is shared among the four provinces of Pakistan, namely, Punjab, Sindh, Baluchistan and Khyber Pakhtunkhwa (KPK) – using five commonly used bankruptcy rules and the Shapely value. Two new bankruptcy rules namely the “groundwater‐based rule” and “the proposed rule” are also proposed to address the usage of groundwater: the land affected by salinity and the gross domestic product (GDP) of each province. Additionally, this paper introduces a new method to compare and contrast the bankruptcy rules, the Shapely value and the two proposed rules. The findings suggest that the groundwater‐based rule has the lowest dispersion and is the preferred method for water allocation in the Indus River Basin. The use of the bankruptcy rules, the Shapely value and the two proposed methods has the potential to address the supply–demand mismatches of shared rivers. The proposed framework for selecting the best rule is recommended as an effective tool to facilitate negotiation over practical water allocation within transboundary river basins.

Addressing the supply-demand gap in shared rivers using water diplomacy framework: utility of game theory in the Indus river within Pakistan

“…The WDF encourages a facilitative process for exploring the consequences of choosing a metric through joint fact-finding, involving all contending parties. As an illustrative example, we apply the method proposed by Janjua & Hassan (2020a). This method is based on the principle that the most appropriate rule is the one that has the lowest dispersion.…”

“…The average canal water diversions or the water diverted for irrigation purposes since the construction of Tarbela Dam has only been 127 km 3 , whereas the accords entitlement is 144 km 3 , as shown in Figure 2. As there is no defined mechanism in the Water Apportionment Accord for the sharing of water deficits, it therefore creates a dispute among the provinces (Condon et al, 2014;Janjua & Hassan, 2020a). Also, the two small provinces (population-wise) of KPK and Baluchistan are exempted by the water shortages by an act of 2003; this is deemed unfair by Punjab and Sindh as they have to share the water deficit during the shortage ( Janjua & Hassan, 2020b).…”

“…The water requirements in this study were taken from the latest study conducted by Janjua & Hassan (2020a), according to which the water requirements are 157.25 km 3 . According to various studies, the water required for the 'Environmental Flows' is 12.3 km 3 (Archer et al, 2010).…”

“…In this paper, we will look at the utility of game-theoretic approaches (e.g. Wang, 2003;Kucukmehmetoglu & Guldmann, 2004;Madani & Dinar, 2011;Mianabadi et al, 2015;Janjua & Hassan, 2020a, and references therein) to address supply-demand gaps in TRBs using the WDF (Islam & Susskind, 2012.…”

“…A key new feature of this paper is the use of WDF to address the supply-demand gap using different tools from game theory. This paper builds on some of our earlier work published in Janjua & Hassan (2020a) with significant new analyses, including the Nash Bargaining Solution for water allocation for different scenarios based on groundwater usage, agricultural productivity, and population.…”