The Kosi river breached its eastern embankment at Kushah in Nepal on August 18, 2008 causing havoc and misery to over 50,000 Nepalese and 2.5 million Indians in the state of Bihar. The affected people lost their homes, farmlands and livelihoods. Four months after the disaster, the affected people are still living in plastic tents in winter. Due to the impact of this catastrophe on the more industrialized and prosperous eastern Nepal, the overall effect on the country’s economy has been severe. At the time of the breach, the river was actually below the level of normal discharge. There was no big flood in Kosi. This was not Nature’s wrath but simply human failings. Bihar’s Water Resources Minister, Vijender Yadav, admitted “The breach happened due to lackadaisical maintenance of the embankment’, but laid the blame on the “previous government”. With timely action such a disaster could have been averted. Saif Uddin Soz, India’s Union Minister for Water Resources, has already said publicly that “Kosi is in focus this time in particular … our main interest is flood control and irrigation,” a statement that puts focus on implementation of the Sapta Kosi High Dam in Nepal. This dam will be built at a great social and environmental cost to the Nepalese people due to submergence of limited fertile valleys, displacement of large number of villagers and over 300 km of very large link canals from both banks of the dam (Kosi-Mechi and Kosi-Ghagra Links) to the Indian border. The attraction to Nepal is, of course, the 3,300 MW of power it will make available for export. The Sapta Kosi High Dam needs to wait until the vital 13-year pending issues of the “signed, sealed and done” 6,720 MW Pancheshwar Multipurpose Project on the Mahakali are finalized.Key words: Kosi Catastrophe; Sapta Kosi high dam; Kosi barrage; flood; NepalHydro Nepal: Journal of Water, Energy and Environment Issue No. 4, January, 2009 Page 2-7