http://news.yahoo.com/s/afp/20091116/pl_afp/uspakistanintelligencea...

WASHINGTON (AFP) – The CIA provides hundreds of millions of dollars to Pakistan's spy service, including payments for the capture or killing of wanted militants, a US newspaper reported, citing unnamed officials and former officials.

The CIA's financial support accounts for as much as one-third of the Inter-Services Intelligence (ISI) agency's budget, the Los Angeles Times reported on Sunday.

When contacted by AFP, the Central Intelligence Agency declined to comment Monday on the report.

The clandestine program that offers bounties to the ISI for the capture or killing of militants has prompted fierce debate within the US government, officials told the paper, as ISI is suspected of retaining ties and providing support for Taliban and other Islamist extremists in Afghanistan.

The payments were first approved by former president George W. Bush and have continued under President Barack Obama, the report said.

Compared to the vast amount of publicly declared military and civilian aid to Pakistan, CIA officials told the paper that their payments were a bargain.

"They gave us 600 to 700 people captured or dead," one former CIA official who worked with the Pakistanis was quoted as saying. "Getting these guys off the street was a good thing, and it was a big savings to (US) taxpayers."

Another intelligence official said Pakistan had made "decisive contributions to counter-terrorism."

The ISI used some of the funds to construct a new headquarters, as Washington had worried that the old officers were vulnerable to attack, the paper wrote.

In an indication of close ties to the Pakistani spy service, the CIA has regularly invited ISI agents to a secret training facility in North Carolina, it said.

Top US officials, including Admiral Mike Mullen, the chairman of the Joint Chiefs of Staff, openly voiced concern earlier this year about ISI's suspected ties with the Taliban.

Pakistan switched from top Taliban backer to US ally after the September 11, 2001 attacks.

But the ISI has long faced allegations of insubordination to Pakistan's government and of channeling support to the Taliban as a counter to arch-enemy India, which has cultivated friendly relations with the Kabul government.

During the Cold War, the ISI worked with the CIA to arm Islamist groups that fought Soviet forces in Afghanistan. The ISI later backed the Taliban, which imposed austere Islamic rule on the war-torn country.

US media have previously reported that American officials had found evidence that ISI operatives provided money, military supplies and even strategic planning to Taliban commanders in Afghanistan.