Pakistan court bails man accused of masterminding Mumbai attack

ISLAMABAD (Reuters) - A Pakistani court granted bail on Thursday to a MAN (MAN.XE)accused of masterminding a deadly 2008 rampage through the Indian city of Mumbai, lawyers said.

The decision to grant bail to Zaki-ur-Rehman Lakhvi is likely to enrage India and may hinder recent attempts to patch up rocky relations between the nuclear-armed neighbours.

Lakhvi was arrested in Pakistan in 2009 in connection with the attack on Mumbai by Pakistani militants in which 166 people were killed. The sole surviving gunman had identified Lakhvi as the mastermind.

Since then, he has been held in the top-security Adiala Jail in the city of Rawalpindi, adjacent to the capital, Islamabad.

"Yes, the court has issued Lakhvi's bail orders today, against a surety amount of one million rupees (6,386 pounds)," defence lawyer Rizwan Abbasi told Reuters.

"Hopefully, he will be out on Monday or Tuesday."

Prosecutors could challenge the ruling, one said.

"After reading through the detailed order, we will be in a position to decide if we are going to challenge the court's decision," said prosecutor Chaudhry Azhar.

India blamed Pakistan-based militant group Lashkar-e-Taiba for the Mumbai attacks. Ten gunmen spent three days spraying bullets and throwing grenades around some of the country's most famous landmarks.

Relations between India and Pakistan, who have fought three wars since independence from Britain in 1947, nosedived after the attacks and have still not fully recovered. A long-running dispute over the Kashmir region periodically flares into violence.

Pakistani Prime Minister Nawaz Sharif, elected last year, says reconciliation with India is a priority. But this year, India elected Narendra Modi, a hawkish nationalist whose party is often accused of favouring India's majority Hindus at the expense of other religious minorities.

The court ruling came as Pakistan was struggling to come to terms its biggest ever militant attack, the killing on Tuesday of 132 school children and nine members of staff in the city of Peshawar. The Pakistani Taliban said it was revenge for a military offensive against them.

India condemned the attack.

Sharif has since vowed there would no longer be any distinction between "good" and "bad" Taliban, an attempt to draw a line under years of Pakistani support for militants it saw as useful in opposing Indian influence.

India and Afghanistan have frequently accused Pakistan of harbouring militants who carry out attacks in their countries.

Pakistan insists the policy is over but many militant groups banned by the government still operate under new names.

(Writing by Katharine Houreld; Editing by Robert Birsel)

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