In its annual "Patterns of Global Terrorism" report released late on Thursday, the US State Department also referred to close cooperation between Pakistan's military and intelligence and the United States to track down suspects at home and abroad.

"Pakistan continues to be one of the United States' most important partners in the global coalition against terrorism," the State Department said of the country that was the first recruit for President George W Bush's war on terror after the September 11, 2001, attacks on New York and Washington.

Under US pressure, Pakistan has sent tens of thousands of troops into its semi-autonomous tribal areas and launched a series of operations against suspected al Qaeda and Taliban fighters living or hiding in the area.

In the latest clashes in March, not covered by the 2003 report, more than 120 people were killed in what experts say was a botched attempt to flush out foreign militants and local tribesmen fighting alongside them.

Keen to avoid a repeat of the bloodshed, the authorities have narrowed the hunt for militants to 25 key suspects, including al Qaeda chief Osama bin Laden and his deputy Ayman al-Zawahri.

The apparent softening in stance has raised fresh questions among Western diplomats over the level of commitment in Pakistan to pursuing militant suspects along the Afghan frontier.

But some Pakistani officials counter that aggressive US military tactics in Iraq have backfired and say there are some parallels with what could happen in tribal areas.