The Hydro-Pack was a black market upgrade to Clank that you could acquire in the first Ratchet & Clank game on Planet Hoven. It could be bought from Edwina's Robo Shack for 2,000 bolts. The Hydro-Pack was a useful upgrade that allowed Clank to use jets to propel him and Ratchet underwater much more effectively than if Ratchet were to swim on his own. This feature also allowed Ratchet to swim against currents to get to secret areas, like up the river in Tobruk Crater, Novalis, and navigate water storages that have a timed electric current running through the water. This upgrade didn't allow Ratchet to avoid the large fish that dwell in many waters.
Clank kept the upgrade for the later games, and so it was immediately available from the beginning of the game.
On the European Going Commando site, it stated that the Hydro-Pack was fitted with Torpedo Launchers, but this feature never made it into the final game, so Ratchet was still vulnerable to any creatures that may prey on him in the water.
In Ratchet & Clank Future: Tools of Destruction, the Hydro-Pack can be equiped and used like the Thruster-Pack.