Dulat, who was a member of the Crisis Management Group handling the 1999 hijack of the Indian Airlines IC 814 plane, said they could not decide that the plane should not leave Amritsar.
"So instead of giving out clear instruction to Punjab police, which was incharge on ground there... nobody was willing to say this plane should never be allowed to leave Amritsar. That nobody said, because nobody was willing to take that call. Everybody thought what will happen if people die," he said.
The former RAW chief also said that initially the terrorists wanted 105 terrorists to be freed.
"It happened on 30th December, finally a call was taken to release three militants... Initially, they wanted 105 then it came down to 35, to 15 and finally our team that had gone to Kandahar managed to bring it down," he said.
He also said two of the three terrorists were in Jammu and Kashmir and then chief minister Farooq Abdullah was angry about letting them go.