Congress leader Shailaja Acharya was against the Mahakali Treaty between Nepal and India, which was ratified by a two-thirds vote of the parliament in Asoj 2053. She had opposed the treaty in the Congress Central Committee, saying that there was ambiguity regarding the sharing of water. Acharya was the only leader in the Congress to oppose the Mahakali Treaty. The treaty was ratified by the parliament during the coalition government led by Congress Prime Minister Sher Bahadur Deuba. Shailaja had expressed her disagreement before the treaty was ratified. At that time, she was only a Congress MP. 

Even after she was appointed as Deputy Prime Minister and Minister for Water Resources in the cabinet of Prime Minister Girija Prasad Koirala in the last week of Chaitra 2054, the ruling and opposition parties were dissatisfied after she opposed the Mahakali Treaty. As the Minister for Water Resources, on 22 Shrawan 2055, she was opposed in the parliament session after she said that the Mahakali Treaty had errors and needed to be corrected. He had created a stir in the political circles and diplomatic circles by saying that the Mahakali Treaty would also affect relations with India. Minister Shailaja, however, did not give up her stance. Her stance was accused of trying to stop not only the Mahakali Treaty, but also the American energy company Enron, which was coming to conduct a feasibility study of the Karnali Chisapani Hydropower Project. Shailaja, while informing about the public importance of the Parliament meeting, had said, ‘It was said that it was passed by two-thirds of the Parliament, that it was passed by the so-called national consensus. Now it is said that the Mahakali Treaty is alive. We should think seriously about who will take responsibility for it.’ 

After hearing Minister Shailaja’s views, the RPP and UML MPs had protested in the meeting. But she did not give up her stance. She had said, ‘Why was the treaty that many dreamed of not implemented? Whether the parliament thinks or not, the biggest issue is water, not electricity.' She said that the issue of water sharing is being made a national issue and that the country needs to rise above the party and speak out to shoulder its serious responsibility. She had put forward the idea that before implementing the Karnali Chisapani Project, there should be a discussion with India on the benefits of the downstream and reach an agreement. Since the Karnali Hydropower Project is a multipurpose project, it would be against the country's interest to extract electricity from it.  

UML MPs Bhim Rawal, KP Oli, RPP's Prakash Chand Lohani, Sarvendranath Shukla had objected to Shailaja's statement. They had opposed the minister's statement. There had been protests in the parliament for a week that the government was trying to sideline the American company Enron. 

Water Resources Secretary Bishwababu Regmi had written to Enron on July 24, 1998, asking them to be patient until there was progress in Pancheshwor. Enron had proposed a feasibility study of Karnali Chisapani when Sher Bahadur Deuba was the Prime Minister. But after the government did not take any decision on the proposal for two years, Enron withdrew the proposal, citing its own managerial and market shortcomings. In a meeting in Parliament, RPP MP Kamal Thapa had questioned what was wrong with the Mahakali Treaty. He claimed that the fault was not in the treaty but in its implementation. Congress MP Pradeep Giri had demanded that the error be explained. RPP's Lohani and Shukla had accused Minister Acharya of siding with India and trying to get Enron to withdraw. Responding to this, Shailaja had asked in Parliament not to question anyone's self-respect. CPN-ML MPs seemed to be supporting Shailaja's statement. ML MP Devi Ojha had demanded that the Mahakali Treaty be made a national issue and discussed. Another ML MP Bhojraj Joshi had said that what the minister said was correct. 

The UML had been divided over the dispute over whether or not to ratify the Mahakali Treaty in Parliament. Although there were many reasons for the split, the Mahakali Treaty was the final reason. Therefore, when Water Resources Minister Shailaja called the Mahakali Treaty a mistake, ML supported his statement. The MPs who formed the ML party did not vote in favor of the Mahakali Treaty.

The leader of the main opposition party, Manmohan Adhikari, and former Prime Minister Deuba, who is affiliated with the ruling party, had also questioned Shailaja for stopping Enron. The former Prime Ministers were in favor of the Mahakali Treaty and Enron. If India's claim to the Mahakali waters as a right was established during the preparation of the DPR for Pancheshwor, it was accepted that Nepal could not demand compensation for the benefits it received from the Karnali Chisapani. That is why it was assumed that Shailaja had first asked Enron to be patient, thinking of removing the obstacles in the process of preparing Pancheshwar. The lawmakers, however, had been of the opinion that the issues of downstream benefits of Pancheshwar and Karnali were different. Since the Mahakali River, where the Pancheshwar project will be built, is shared by some lawmakers, the issue of Pancheshwar does not apply to Karnali Chisapani. According to the estimates at that time, it was risky to allow Enron to move forward until the return that Nepal would get for the incomparable benefit of the controlled flow of water that would reach India from the 10,800 MW Karnali Chisapani hydropower project was certain. At that time, Prime Minister Koirala was in favor of large hydropower projects. But Shailaja's emphasis was on small projects. Some said that this also created conflict. 

Even when Pashupati Shumsher Rana was the Minister of Water Resources, the granting of a study license to Enron was delayed. But Rana used to hold all-party meetings and discuss the issue of Enron when he decided on the matter. Shailaja said that the transparency was also questioned in political circles because he wrote to Enron to be patient only on the advice of those around him and officials from the ministry.