London, July 3: A well-known Indian infrastructure company, Som Datt Builders, has been implicated in Iraq's chemical weapons programme in British cabinet papers from 1983 released in London.

The gist of the disclosure is that Margaret Thatcher's government knew that Saddam Hussein was acquiring chemical weapons but found reasons at that stage not to take action against the Iraqi leader.

Newly released papers from 1983 show that even before Iraq began widespread use of poison gas to repel Iranian attacks, British diplomats were aware of Baghdad's covert technology programme.

The secret file, entitled Chemical Weapon Manufacture in Iraq, records how officials agonised over whether to intervene. It has been released to the National Archives in Kew, west London.

In April 1983, at the height of the Iran-Iraq war, the British ambassador in Baghdad, John Moberly, sent a telegram to the foreign office in London and to the UK's defence intelligence sections about the "manufacture and use of mustard gas by the Iraqi army".

He said: "The UK company Weir Pumps has supplied a number of pumps to Indian contractors, Somdat Builders, who are building a factory at Samarra to manufacture pesticide."

Weir Pumps, he said, had been frustrated in its attempts to discover technical information about the project.

Moberly added: "It would, therefore, seem fairly certain that part of the Samarra pesticide factory may also be used to produce materials for chemical warfare, including the manufacture of mustard gas."

There is the question of what Som Datt Builders knew or didn't know about the use of the pesticide factory at Samarra to the north of Baghdad to produce mustard gas.

The Telegraph has asked Som Datt Builders for a comment, which has so far not been forthcoming.

The company does not deny being very active in Iraq - in fact, it is very proud of its overseas record. According to its website, "Som Datt Builders (SDB), under the able guidance and vision of its founder Chairman, Dr. Som Datt, has emerged as a leader in Infrastructure Construction and Turnkey Projects.

"Since its inception in 1965, Dr Som Datt and his brothers, Dr Brahm Datt (Managing Director) and Dr Inder Mohan (Vice-Chairman), have taken the company to dizzy heights and created an enviable name for the Company, both in India and internationally."

It points out: "SDB was the first Indian Company to undertake project exports from India in 1976. It completed large projects in Algeria, Saudi Arabia, Jordan and went on to become the leading Construction Company in Iraq, executing 31 projects."

It adds: "Engineering News Record, USA, ranked SDB 108th out of the top 250 construction companies in the world. During its peak activity in the Middle East and Iraq, SDB achieved an annual turnover of US $100 million and executed overseas projects worth US $1.1 billion."#

The disclosure in London is more of an embarrassment for the UK which, under Tony Blair, joined George Bush's military invasion of Iraq in 2003 because of Saddam Hussein's alleged possession of chemical and other weapons of mass destruction - in the event none was found.

However, back in 1983, the enemy was not Iraq but Iran.

According to the British cabinet papers, Thatcher's government was reluctant to press for an international ban on Iraqi dictator Saddam Hussein acquiring chemical weapons amid fears any criticism could rebound on the UK.

While there was some discussion within the Foreign Office on trying to prevent Iraq acquiring a chemical weapons (CW) capability, officials noted that it could prove difficult as they were not banned under international treaties, even though their use was prohibited under the Geneva Protocols.

"The Iraqis could therefore legitimately say, as do the United States, that they need CW as a deterrent," a Foreign Office paper noted.

"A move to ban CW sales to Iraq would therefore look very discriminatory unless we could show that Iraq had breached, or intended to breach, the Geneva Protocol," the paper went on.

But there was also, the paper acknowledged, another concern closer to home. "Caution may be in order, since our own trade in CS gas has not escaped criticism. (The Russians claim that our use of CW in Northern Ireland contravened the Geneva Protocol)."

"Another relevant factor is that a British company, Weir Pumps, has apparently supplied pumps to the Samarra factory under the impression that they were for use in making pesticides," the paper also said.

Officials agreed there should be an approach to "our closest allies" with a view to trying "at least to slow down, and perhaps even to frustrate Iraqi ambitions in this field".

It is not known whether Britain approached India over its concerns.

Ultimately, the Foreign Official in London took a pragmatic view of the matter: "Britain alone could take limited action to control exports, but this would do little good. Global action might eventually be effective but would probably require public presentation of our evidence and would be very slow. Given that the Iraqi programme is already far advanced, I am sceptical about the feasibility of effective action."

In terms of the desirability of intervening, the paper concluded: "Iraq is acting within her rights acquiring (chemical weapons), and this has a bearing on the desirability of taking action against her."

By 2003, however, Saddam was the enemy when Blair decided it would be pragmatic to take a very different view and massaged "a dodgy dossier" to make the case for military intervention.

An estimated 20,000 Iranians were killed by mustard gas and nerve agents during the Iran-Iraq war, the Guardian has reported. "Many more still suffer lingering after-effects. The Chemical Weapons Convention, which bans the production, stockpiling and use of chemical weapons and precursors, did not come into force until 1997. International outrage over Iraqi use of poison gas was pivotal in changing attitudes."