A three member Supreme Court bench set Rs 1 million as the bail amount and ordered his release.

Both Zardari and Benazir Bhutto earlier claimed in separate communications with the South Asia Tribune that the bail was not the result of any compromise or deals with the military government.

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"I have spent 8 years in jail and there is no reason for me to strike a deal now," Zardari told Tribune editor Shaheen Sehbai in a telephone conversation on Sunday night (Pakistan time), a few hours before the judgment was given by the court. "They have run out of legal steam against me, what else they could have done."

His wife Benazir Bhutto, in her first reaction to the judgment, told Sehbai from Dubai: "Asif deserved to be released, legally and morally. His release would be unconditional. He could have been released much earlier if it was through a deal."

Zardari's bail in the BMW case--was accused of importing a bulletproof BMW in the name of a fictititous person--was granted by the Supreme Court after several adjourned hearings and several hours of arguments on Monday. 

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It raised immediate speculation that secret negotiations between Zardari and Army Generals may have resulted in his bail because General Musharraf needed cooperation from Benazir Bhutto against the Mullas who wanted him to quit his Army job.

According to the Tribune, several leading journalists and politicians have been speculating that General Musharraf has been trying to convince Zardari to make a deal under which Musharraf may get legitimacy and support by the PPP in return for relief from political persecution.

But Benazir Bhutto and PPP have consistently denied any such deal saying the military regime has been leaking stories frequently to discredit the PPP and to create doubts among ARD partners.

The Tribune report said Zardari, speaking on telephone, said: "I am ready to play my political role." In his phone talk, the jailed politician, sounded in high spirits and ready for all eventualities.

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"I have nothing more to lose," Zardari said but "I will certainly not compromise the 8 years of my sacrifices now."

Asif Ali Zardari was arrested on November 4, 1996 in Lahore and eight cases were filed against him. The courts had granted bail to Zardari earlier in all other cases except the BMW one.

The Tribune said the release of Asif Zardari will mark the beginning of a new phase of politics in Pakistan as other political partners of PPP may seek assurances to the effect that PPP would continue to be an active partner in the movement against General Musharraf's uniform and for restoration of full democracy.

Analysts say while PPP wanted relief for Mr Zardari and Benazir Bhutto as a matter of right, the military wants to the PPP to promise not to join hands with the religious extremists now threatening to launch a campaign against General Musharraf.

The dilemma for the PPP is that it is opposed to the religious rightists as a matter of policy, and not because they oppose Musharraf. Many PPP leaders have been openly expressing their views that PPP and ARD should not join the MMA under any circumstances, the Tribune said.

On the other hand, Musharraf and his Generals are themselves stuck in a corner and need the support of the liberal and mainstream political forces to meet the serious internal and external pressures which are now expected to increase substantially.

Clemency for Bhutto's jailed husband possible 

At a time when General Musharraf wants to make a deal with India on Kashmir, the Army desperately needs dependable political crutches which obviously the opportunists and turncoats in the Government camp cannot provide, the Tribune said.

"The situation is absolutely ripe for conciliation between the military and the mainstream political parties and Zardari's release can become the beginning of the healing process," one analyst told the Tribune.

More reports from Pakistan