Sarkozy pressured on Pakistan arms deal allegations

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French opposition lawmakers Thursday called on President Nicolas Sarkozy to give all details of any links to suspected kickbacks on arms deals allegedly used to fund political campaigns.

Three Socialist deputies spoke out after extracts from a Luxembourg police report published Wednesday alleged that a company set up with Sarkozy's approval channelled money from arms deal commissions to fund political activities in France.

French investigators have since 2008 been probing allegations that the cancelling of commissions for one of the arms deals prompted an attack that killed 11 French engineers in Pakistan in 2002.

News website Mediapart quoted a Luxembourg police report as saying that Sarkozy oversaw the establishment in Luxembourg of two companies, Heine and Eurolux, when he was budget minister under Prime Minister Edouard Balladur.

Balladur and Sarkozy have repeatedly dismissed allegations of illegal party funding.

But Mediapart quoted the Luxembourg police as saying: "The agreements on the creation of the two companies appear to have come directly from Prime Minister Balladur and Finance (Budget) Minister Nicolas Sarkozy."

"Part of the funds that passed through Luxembourg (companies) came back to France to finance political campaigns" in 1995, added the police report, which cited unspecified documents.

Sarkozy served as spokesman for Balladur's 1995 presidential campaign.

Government spokesman Luc Chatel dismissed the recurring allegations as "a serial fairytale" and said the government was cooperating with an investigation by a French judge.

Socialist lawmaker Manuel Valls and the party's deputy leader Harlem Desir called for French judges to obtain the Luxembourg police documents and shed light on the affair.

"The officials at the time, namely Edouard Balladur and Nicolas Sarkozy, the budget minister who was in charge of the sale and the commissions, must be asked to provide all the information that the French are waiting for," Desir added.

"The ministers at the time owe that to the French people and to the families of the victims" of the Pakistan killings, he said.

Balladur lost the 1995 presidential election to Jacques Chirac, who promptly cancelled commissions that were allegedly due to be paid to Pakistani officers.

In May 2002 a bomb in Karachi killed 11 French naval engineers who were in Pakistan to build the submarines.

A French judge investigating the attack suspects it may have been carried out in revenge for the cancelled bribes. That claim was first raised by an internal inquiry carried out in 2002 by DCN, the French state-run shipbuilder that made the submarines.

A Socialist deputy who headed a parliamentary commission on the Karachi attack, Bernard Cazeneuve, was quoted by Le Parisien newspaper on Thursday as saying: "the government is doing everything to obstruct the truth."

Defending the government, Chatel said: "These contracts took place in the very early 1990s," before Balladur became prime minister in 1993.

"The Balladur government did not have responsibility at the time" the arms deals were signed, Chatel added.

© 2010 AFP

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