'Arms deal revenge' theory discounted in 2002 Karachi bomb probe

The theory of a revenge attack, carried out after former president Jacques Chirac cancelled the payment of bribes on arms deals signed with Pakistan and Saudi Arabia in 1994, has circulated for years.

Claims that some of the money paid in bribes was channelled back to France to help fund the 1995 presidential campaign of Chirac's conservative rival, ex-prime minister Edouard Balladur, appeared to bolster that theory.

But in a note sent to magistrates investigating the kickbacks, for which six people went on trial on Monday in Paris, France's counter-terrorism agency DGSI said it believed the initial theory of an Islamist attack remained the most likely scenario.

In support of the hypothesis, the intelligence note cited the timing of the attack -- shortly after the September 2001 attacks in the US when France was engaged in the war against the Taliban in Afghanistan.

It also noted "more generally the threats against Western interests at the time and in this region" in laying out the case for an attack by Al-Qaeda or another terror group.

Yet 17 years after the bombing, the investigation -- France always launches its own probe into attacks on foreign soil in which French citizens are victims -- had yet to produce "any new element... on the perpetrators of this terrorist act", the DGSI conceded.

The theory of a dodgy arms deal gone wrong has kept the Karachi attack in French headlines for nearly two decades.

On Monday, three former French government aides, two Lebanese middlemen and the former head of the international division of French defence contractor DCN (now called the Naval Group) went on trial over the alleged kickbacks, believed to have amounted to 13 million euros.

Balladur, 90, and his former defence minister Francois Leotard, 77, have also been charged in the case.

They will be tried by the Court of Justice of the Republic, a tribunal that hears cases of alleged misconduct by government ministers.

cb/js/bp

NAVAL GROUP