These have been aimed at persuading the International Monetary Fund and other lenders to advance more money, to enable the government to avoid the biggest sovereign debt default in history But this week the populace ran out of patience.. President Bush extended his financial war on terrorism yesterday by ordering a freeze on the assets of two groups in the Indian subcontinent. Careful to appear even-handed in the fraught stand-off between Delhi and Islamabad over the territory, Mr Bush described the group as a “stateless sponsor of terrorism”.The second group is Umma Tameer-e-Nau, set up by a former Pakistan nuclear scientist and which America says masqueraded as a charity. President Bush said its real aim was to give al-Qa’ida information on nuclear weapons..

Evidence that Iraq has been developing chemical, biological and nuclear weapons since the departure of United Nations weapons inspectors three years ago was offered by an Iraqi military engineer who fled the country this year. His last job was as recently as a year ago.Mostly, he saw these places before any weapons work had taken place. But he also said he was shown biological materials in a facility beneath the Saddam Hussein Hospital in Baghdad.For one repair job, at a facility in Waziriya, an industrial suburb of the Iraqi capital, he was required to wear a rubberised suit, gas mask and blue plastic boots – the same protective clothing associated with biological laboratories. Some of the facilities were duplicates intended to act as decoys.To back up his claims, Mr Saeed produced documents and invoices showing that he had indeed worked for the government’s Military Industrialisation Organisation and a related company called Al Fao.

A number of experts cited in the New York Times report, including former UN weapons inspectors, said they found the testimony credible and consistent with their knowledge.Mr Saeed’s testimony could strengthen the position of hawks in the Bush administration who favour military action to overthrow President Saddam. It could also help to pinpoint possible targets for air strikes.The paper’s correspondent spoke to Mr Saeedin Bangkok last week. He was said to have been debriefed by American intelligence agencies.. Jack Straw issued an ultimatum to Yasser Arafat yesterday, saying he must either take immediate steps to crack down on Palestinian terrorists or admit that he no longer had the power to deliver. Hamas, Islamic Jihad and other terrorist organisations have to be broken up, their operatives have to be locked up and they have to end the intifada.”He added: “Arafat is the democratically elected President of the Palestinian Authority. We have to work on the basis that until he countermands this, he has authority within the area.

If he hasn’t, then he should say so.”People with a key role in the search for peace, like Shimon Peres, continue to believe Arafat has the potential to deliver. If he hasn’t, then he should say so.”Although Mr Straw denied that he was adopting a more pro-Israeli line, he admitted that Britain’s position had changed because of the suicide bombings in Israel by Palestinian militants.”It is not a change of strategy But circumstances have changed,” he said. The Israeli government was under “unbelievable pressure” because of the bombings, he added.”If there was an Omagh happening every weekend, then this would place any government under the most astounding pressure,” he said. But he also said Israel should halt illegal incursions into Palestinian areas. Mr Straw’s comments reflect growing impatience with Mr Arafat in London and Washington.One government source said: “Straw has had so many conversations in which he agrees on what needs to be done, but then it is not done.