The American position can be understood from the Supreme Court decisions. Excerpts from Justice Brewer's opinion in Kansas v. Colorado explain the situation.
"In a qualified sense and to a limited extent, the separate states are sovereign and independent, and the relations between them partake something of the nature of international law. This Court in appropriate cases enforces the principles of that law, and in addition, by its decisions of controversies between two or more states, is constructing what may not improperly be called a body of interstate law".
"If the two states were absolutely independent nations, it would be settled by treaty or by force. Neither of these ways being practicable, it must be settled by decision of this Court".
On the role of the federal government, Justice Brewer quotes Chief Justice John Marshall's opinion in McCulloch v. Maryland, 17 U.S. 316 (1819): "This government is acknowledged by all to be one of enumerated powers. The principal that it can exercise only the powers granted to it would seem too apparent to have required to be enforced by all those arguments which its enlightened friends, while it was depending before the people, found it necessary to urge. That principle is now universally admitted".
Justice William O. Douglas in his opinion in Nebraska v. Wyoming, 325 U.S. 589 (1945) reiterates the position writing "a clash of interests which, between sovereign powers, could be traditionally settled only by diplomacy or war. The original jurisdiction of this Court is one of the alternative methods provided by the Framers of our Constitution".
I can not find a single judgment where a state organ was treated as an appropriator. In Nebraska v. Wyoming, the federal government claimed it acquired water rights by appropriation for two projects and retains the rights to the extent not disposed of. The secretary of interior filings for the projects were accepted by state officials. Justice William O. Douglas in his opinion did not accept the plea that this act conferred proprietorship rights to the federal government.
Justice Douglas cited several precedents including Ickes v. Fox, 300 U.S. 82 (1937): "Although the government diverted, stored, and distributed the water, the contention of petitioner that thereby ownership of the water or water rights became vested in the United States is not well founded. Appropriation was made not for the use of the government, but, under the Reclamation Act, for the use of the landowners, and, by the terms of the law and of the contract already referred to, the water rights became the property of the landowners, wholly distinct from the property right of the government in the irrigation works".
He ruled: "The rights of the United States in respect to the storage of water are recognized. So are the water rights of the landowners. To allocate those water rights to the United States would be to disregard the rights of the landowners. To allocate them to the States, who represent their citizens parens patriae in this proceeding, in no wise interferes with the ownership and operation by the United States of its storage and power plants, works, and facilities. Thus, the question of the ownership by the United States of unappropriated water is largely academic so far as the narrow issues of this case are concerned".
It may be noted the American constitution confers no rights to the federal government respect to inter-state flowing waters. Considering this and the above together it emerges that inter-state water sharing in the US was an uncharted territory. While states are free to manage water flowing through their territories, the federal government has no right of oversight. Inter-state water disputes therefore fall in the original jurisdiction of the Supreme Court. While the states can act as parens patriae of their citizens, they do not posess any water rights themselves.
International Law Association (ILA) adopted a set of guidelines called "Helsinki Rules on the Uses of the Waters of International Rivers" ("Helsinki rules" in common parlance) at its fifty second conference held at Helsinki in 1966. While these guidelines have no formal status and lack an enforcement mechanism, these represent a pioneering effort in trans-boundary water management.
The Helsinki rules consist of 37 articles spread over 6 chapters. We will go into the relevant aspects to the extent necessary below.
Chapter 1 (articles 1-3) covers scope and definitions. It may be noted that the scope excludes "as may be provided otherwise by convention, agreement or binding custom among the basin States".
Chapter 2 (articles 4-8) is the most relevant for our study as it deals with "equitable utilization of the waters of an international drainage basin". Article 4 states: "Each basin State is entitled, within its territory, to a reasonable and equitable share in the beneficial uses of the waters of an international drainage basin".
Article 5 has three sections. The first section requires that the reasonable and equitable share shall be ascertained "in the light of all the relevant factors in each particular case".
The second section of article 5 provides a non-exhaustive list of some relevant factors. The third section states: "The weight to be given to each factor is to be determined by its importance in comparison with that of other relevant factors. In determining what is reasonable and equitable share, all relevant factors are to be considered together and a conclusion reached on the basis of the whole".
The list provided in 5 (2) is produced in full below:
1. The geography of the basin, including in particular the extent of the drainage area in the territory of each basin State
2. The hydrology of the basin, including in particular the contribution of water by each basin State
3. The climate affecting the basin
4. The past utilization of the waters of the basin, including in particular existing utilization
5. The economic and social needs of each basin State
6. The population dependent on the waters of the basin in each basin State
7. The comparative costs of alternative means of satisfying the economic and social needs of each basin State
8. The availability of other resources
9. The avoidance of unnecessary waste in the utilization of waters of the basin
10. The practicability of compensation to one or more of the co-basin States as a means of adjusting conflicts among uses
11. The degree to which the needs of a basin State may be satisfied, without causing substantial injury to a co-basin State
Article 6 precludes inherent preference of any use over others. Article 7 prohibits denial of reasonable use to a basin state on the basis of future uses of other states.
Article 8 relates to "existing reasonable uses". Section 1 states: "An existing reasonable use may continue in operation unless the factors justifying its continuance are outweighed by other factors leading to the conclusion that it be modified or terminated so as to accommodate a competing incompatible use". Section 2 defines the entry & exit criterion of an existing use. Section 8 (3) prohibits a use that is incompatible with an already existing reasonable use at the time of becoming operational from being treated as an existing use.
Chapters 3, 4 & 5 (articles 9-25) relate to pollution, navigation & timber floating. These are not relevant to this study.
Chapter 6 (articles 26-37) outlines the procedures for preventing and/or settling disputes. This does not warrant a detailed discussion at this stage.
UNO adopted a document in 1997 titled "convention on the law of the non-navigational uses of international watercourses". This has not yet gone into effect as the prescribed minimum of member states are yet to ratify the law. It may be noted India has not yet ratified the convention. The document consists of 37 articles plus an additional 14 articles in the annexure. We will go into the relevant aspects to the extent necessary below.
Article 1 defines the scope of the convention. Navigation is specifically excluded from the convention's scope. Article 2 defines important terms including "watercourse". Articles 3 & 4 cover watercourse agreements.
Articles 5 & 6 are the most relevant for our study as these deal with "equitable and reasonable utilization and participation". Article 6 (1) provides a non-exhaustive list of some relevant factors (produced in full below):
(a) Geographic, hydrographic, hydrological, climatic, ecological and other factors of a natural character
(b) The social and economic needs of the watercourse States concerned
(c) The population dependent on the watercourse in each watercourse State
(d) The effects of the use or uses of the watercourses in one watercourse State on other watercourse States
(e) Existing and potential uses of the watercourse
(f) Conservation, protection, development and economy of use of the water resources of the watercourse and the costs of measures taken to that effect
(g) The availability of alternatives, of comparable value, to a particular planned or existing use
Article 6 (2) enjoins states to consult each other to ascertain equitable utilization. Article 6 (3) states: "The weight to be given to each factor is to be determined by its importance in comparison with that of other relevant factors. In determining what is a reasonable and equitable use, all relevant factors are to be considered together and a conclusion reached on the basis of the whole".
Article 7 calls upon states to prevent significant harm to other states and, if harm does occur, mitigate and/or compensate the harm in consultation the injured states.
Articles 8 & 9 outline the responsibilities related to mutual cooperation and information exchange. Article 10 precludes (in the absence of agreement or custom) inherent priority of any use over others and prescribes the modalities of conflict resolution.
The rest of the convention relates to matters such as preventing and/or settling disputes. These do not merit a detailed discussion at present.
"All things in this creation exist within you, and all things in you exist in creation; there is no border between you and the closest things, and there is no distance between you and the farthest things, and all things, from the lowest to the loftiest, from the smallest to the greatest, are within you as equal things. In one atom are found all the elements of the earth; in one motion of the mind are found the motions of all the laws of existence; in one drop of water are found the secrets of all the endless oceans; in one aspect of you are found all the aspects of existence": Kahlil Gibran