Deputy Prime Minister Najib Razak said the truth had prevailed after US Undersecretary of State John Bolton told reporters that President George W. Bush had not meant to imply that the government was involved in shipping centrifuge parts to Libya.

Bolton said at a news conference in Beijing Monday there was "certainly no whiff of an allegation in the president's statement that the government of Malaysia had the slightest thing to do with it".

His clarification followed a protest from Kuala Lumpur after Bush referred in a major speech last week to the seizure of centrifuge parts made in Malaysia aboard a ship destined for Libya last October.

Centrifuges can be used for enriching uranium for nuclear weapons.

Bolton also appeared to accept the explanation of the company involved, Scomi Precision Engineering (SCOPE), that it did not know where the parts were going and thought they were for use in the oil and gas industries.

He said "perfectly reputable companies" could be given specifications and manufacture "these devices and not have any idea what they're ultimately being bound for."

Scomi spokeswoman Rohaida Ali Badarudin told local media Wednesday the company was pleased with Bolton's statement as "it cleared us of being associated with the clandestine network."

Malaysia had been outraged by Bush's linking of the company, which is owned by Prime Minister Abdullah Ahmad Badawi's son Kamaluddin, with the nuclear black market run by Pakistan's disgraced scientist Abdul Qadeer Khan, who has admitted selling nuclear secrets.

However, questions remain about the role of Sri Lankan businessman B.S.A. Tahir, who ordered the parts from SCOPE and was named by Bush as Khan's "deputy, chief financial officer and money launderer".

Premier Abdullah said Tahir had indeed placed the order and had been questioned by police but not arrested. Local police were working with the International Atomic Energy Agency (IAEA) on the investigation, he said.

Abdullah's deputy Najib Razak told AFP Wednesday: "The question is has he broken any laws? We have to investigate and get the facts first before we can act on anything."

The New York Times reported Wednesday that Tahir had been a director of an investment holding company called Kaspadu, until recently owned by his wife in partnership with the prime minister's son.

SCOPE's parent, the Scomi Group, is principally owned by Kaspadu, the paper said.

Scomi spokeswoman Rohaida told the Malay Mail Wednesday that Tahir's wife had relinquished her shares in Scomi Group in early January, after the scandal broke.

"The other shareholders were uncomfortable with her association, with Tahir being her husband," Rohaida was quoted as saying.

The New York Times said Tahir traveled widely, visiting countries including Morocco, where he negotiated with the Libyans, and Switzerland, where he met with an engineer who came to Kuala Lumpur to supervise production of the parts.

Tahir also made trips to Germany and Turkey to meet with suppliers, the Times quoted investigators as saying.

Scomi said Tahir had told them the parts were being made for Gulf Technical Industries, a company in Dubai.

The New York Times said the company was owned by British engineer Peter Griffin, describing him as a longtime supplier to Khan during the time he was building Pakistan's nuclear capacity.

WAR.WIRE