Bhutto, foreign minister and later prime minister, argued that the dam could be used strategically as an instrument of war to bog down Pakistan's armour. After the two wars of 1965 and 1971, all such theories were easily believable. During the negotiations, Pakistan raised technical objections to the design and capacity of the dam. It argued that the 40-foot gates on the spillways gave the dam more storage than allowed by the treaty. It also argued that the under-sluices included for sediment clearing were not permitted under the treaty. Indians argued that the flood risk that Pakistanis expressed was unreasonable. Any intention on India's part to flood Pakistan would involve causing much more damage to its own territory. In the face of Pakistan's unwillingness to relent, the Indian negotiators wanted to take it to arbitration by a neutral expert, as provided for in the treaty. However, after signing the 1972 Simla Agreement with Pakistan, India wanted to steer the relations towards bilateralism. Its foreign policy establishment ruled out going to a neutral expert. In further bilateral talks in October 1976, India made significant concessions in the dam's height and other issues. An agreement was reached in 1977, but deferred till after the elections in Pakistan. Soon afterwards, change of government occurred in both India and Pakistan, but the understanding survived. A formal agreement was signed in Delhi on 12 April 1978 by Indian foreign minister Atal Bihari Vajpayee and Pakistan's foreign secretary Agha Shahi. The height of spillway gates was reduced from 40 ft to 30 ft. The under-sluices designed for sediment management were permanently plugged. The agreement was hailed as a triumph of bilateralism, facilitating an atmosphere of trust and confidence between the two countries. But the agreement also seriously damaged the sustainability of the dam and the Indian engineers viewed it as too high a price to pay for bilateralism. Final construction After signing the agreement in 1978, the construction of the project was entrusted to National Hydroelectric Power Corporation (NHPC) on an agency basis. NHPC was incorporated by the Government of India in 1975, with an authorised capital of Rs. 200 crore. The Salal project was its first project. The Stage-I of the powerhouse was commissioned in 1987; Stage-II between 1993 and 1995. The final commissioning of the project took place in 1996. After completion, the Salal project was transferred to NHPC on an ownership basis. The