Requirements of human are increasing tremendously with massive change along with the evolution of human and its development. This creates stress on the natural resources; such as water, lands, forest, etc. Freshwater demand is highly increased with the growing population and the change in lifestyle of people. Hence, the concept of interbasin water transfer was developed to minimize water scarcity and to distribute water as per requirements. However, this has brought lots of negative consequences that became a challenge to preserve the earth systems. The National River Linking Plan (NRLP) is developed by the Government of India to resolve water scarcity and that plan became controversial especially on the transboundary water right issues. Therefore, the purpose of this paper is to highlight all the major and minor consequences that might happen due to the NRLP project with the perspective of making sustainable environmental development. The study revealed that for the sustainable development; every issue related to nature, socio-cultural and transboundary water right must be addressed and water should be distributed in such a manner that it solves the issues of spatial and temporal water availability.