Feasibility reports for the construction of a dam in Chesti-e-Sharif district were prepared in 1957. In 1976, an Afghan firm was tasked with construction of the dam. The firm appointed Water and Power Consultancy Services Ltd, a company owned by the Indian Ministry of Water Resources, to construct the dam. The 1979 Soviet invasion of Afghanistan halted work on the project. WAPCOS Ltd attempted to continue construction on the dam in 1988, but the project was left incomplete again due to the ongoing instability. In 2006, India committed to funding the completion of the Salma Dam at an estimated cost of US$ 275 million. In January 2013, the Indian cabinet approved revised cost of ₹ 1,457 crores for the completion of the project and declared it would be completed in December 2014, or two years behind the previous schedule. On 26 July 2015 the dam began to impound its reservoir. The dam was inaugurated on 4 June 2016 by Indian Prime MinisterNarendra Modi along with Afghan President Ashraf Ghani. Indian Public sector power equipment manufacturer BHEL played an instrumental role in execution of this project by successfully commissioning two 14MW units in Salma Dam project.
Plots to destroy the dam
Some Afghans believe that politicians in Iran were attempting to stop work on the dam project, which would reduce the flow of river water into Iran. According to the localAfghan National Police of the area, Iranian government is funding local Taliban members to oppose construction of the dam. In 2009, a parliamentarian from Kabul Province, Najibullah Kabuli accused Iran of interfering in the construction of the Salma Dam. When the governor of Chishti Sharif District, Abdulqudus Qayam, was killed along with five security officials in mid-January 2010, the Afghan media called it an insurgent attack. The Taliban accepted responsibility, but many in Herat saw it as part of a wider problem the province is having with Iran. Qayam had been instrumental in pushing the construction of the dam. In March 2013, the National Directorate of Security claimed that Taliban's Quetta Shura attempted to blow up the Salma Dam with of explosives. According to NDS spokesman Shafiqullah Tahiri, "Mullah Abdul Ghani, a member of the Quetta Shura who plans suicide attacks, was behind the conspiracy". The explosives were discovered in a deserted area of the Pashtun Zarghun District of Herat Province, which were smuggled into the area from Balochistan, Pakistan. One person by the name of Sayed Gul was arrested.