Iran to Try Three American Hikers

TEHRAN:    Iran said Monday it would try three Americans who have been jailed since crossing the border from Iraq in July, a step certain to aggravate the U.S. at a time when Tehran is locked in a standoff with the West over its nuclear program.

Foreign Minister Manouchehr Mottaki didn't say when proceedings would begin or specify the charge other than to say the Americans had "suspicious aims." In November, however, authorities accused the Americans of spying.

There are concerns in the U.S. that Iran could use them as bargaining chips in talks over its nuclear program or in seeking the return of Iranians they say are missing.

Relatives of the hikers and the U.S. government say the three were innocent tourists on an adventure hike in northern Iraq and accidentally crossed into Iran, where they were arrested on July 31.

"They will be tried by Iran's judiciary system and verdicts will be issued," Mr. Mottaki said at a news conference, without elaborating.

The Americans -- Shane Bauer, 27, Sarah Shourd, 31, and Josh Fattal, 27 -- were detained by Iranian authorities after crossing an unmarked border from northern Iraq.

At a Nov. 9 news conference, President Mahmoud Ahmadinejad said Iran's judiciary would deal with the Americans, and he noted that Iran accuses the U.S. of holding several of its citizens.

In particular, he drew a link between the case of the three Americans and the trial in the U.S. of Amir Hossein Ardebili, an Iranian who faces up to 140 years in prison after pleading guilty to plotting to ship sensitive U.S. military technology to Iran.

According to court papers, Mr. Ardebili worked as a procurement agent for the Iranian government and acquired thousands of components, including military aircraft parts, night vision devices, communications equipment and Kevlar.

U.S. federal authorities targeted him in 2004 after he contacted an undercover storefront set up in Philadelphia to investigate illegal arms trafficking.

Pakistan Court Rules Detained Americans Can't Be Deported

PAKISTAN:  A top Pakistani court on Monday ruled that five Americans being held on suspicion of terror links can't be deported back to the U.S. or any other country before judges review the case, an official said.

Pakistani police have alleged that the five young Muslim men wanted to join militants in Pakistan's northwest tribal areas before going to Afghanistan. The men are accused of using Facebook and YouTube sites to try to connect with extremist groups in Pakistan.

They have not been formally charged with any crime in Pakistan or produced in court. No deportation order is known to have been issued, though officials from the U.S. and Pakistan have said deportation back to America is likely.

Lahore High Court registrar Tahir Pervez said the court wants more information before such a move is allowed.

The court made the move in response to a petition from Khalid Khawaja, a civil rights activist who has often filed court cases on behalf of alleged militants and people believed to have disappeared at the hands of Pakistan's vast security apparatus.

Mr. Pervez said the court ordered the government of Punjab province to file a report on the case in a hearing Thursday.

The men were picked up by Pakistani authorities last week in the Punjab town of Sargodha after their worried families in the U.S. turned to the FBI to track them down. They were shifted over the weekend to Lahore, the provincial capital, for further questioning.

The five men are from the Washington, D.C. area, and the case has fanned fears that Americans and other Westerners, especially those of Pakistani descent, are traveling to Pakistan to join up with al Qaeda and other militant groups.

FBI agents, who have been granted some access to the men, are trying to see if there is enough evidence to charge any of them with conspiracy to provide material support to a terrorist group, an American official and another person familiar with the case said Friday.

They spoke on condition of anonymity because they were not authorized to discuss the investigation.

FOCUS Dubai Debt Woes Remain Despite Abu Dhabi $10B Bailout

DUBAI:   Abu Dhabi's $10 billion bailout Monday of government-owned conglomerate Dubai World will go a small way to tackle the emirate's debt pile, experts say.

Although the much-needed cash injection provided a welcome boost to investor confidence on the region's stock markets, analysts warn that concerns over Dubai and its debt levels will linger.

"Fundamentally, little has changed for Dubai's outlook," said Fahd Iqbal, Gulf strategist at Egyptian investment bank EFG-Hermes, which estimates that Dubai's total debt, including bilateral loans for Dubai Inc. companies, could be as high as $150 billion.

Abu Dhabi pumped $10 billion into Dubai's financial support fund Monday, part of which will be used to pay off creditors of a $3.52 billion Islamic bond issued by Dubai World's real estate unit Nakheel.

Dubai rocked world markets in late November when it requested a freeze on $26 billion of debt payments by Dubai World, in order to restructure the group. This means that about a further $22 billion still needs to refinanced and creditors are expected to meet with Dubai World on Dec.21 to hammer out a deal.

International investment bank UBS AG said that although the bailout "may provide short-term market relief", an additional $32 billion in loans and bonds repayments still remain outstanding over the next two years.

"Moving away from the debt repayment uncertainty, we focus investors attention back to fundamental economic and systemic challenges which have not changed materially," said Saud Masud, head of research at UBS in Dubai.

RISK PREMIUM

Of the greatest concern to many analysts, is the debt levels of Dubai Holding, the personal investment vehicle of the ruler, Sheik Mohammed bin Rashid al-Maktoum and Dubai World's investment unit Istithmar.

"We continue to see risk of further debt problems emerging in the coming months and quarters, particularly from Dubai Holding and Istithmar and hence we are keeping our elevated equity risk premium," said EFG's Iqbal.

Dubai Holding, which includes investment arms Dubai International Capital and Dubai Group, has built up $9.7 billion in debt during a five-year buying spree, according to Barclays Capital. Of this, $1.9 billion matures next year.

"We believe that the Dubai Government's actions have introduced the risk that restructuring of other corporates could follow. We would focus on those with weak fundamentals and upcoming maturities and we view Dubai Holdings as being most at risk," it said in a note shortly after Dubai World's debt request late November.

Dubai's obligations extend much further than Dubai World and the rest of its government-related entities. It also owes billions of dollars to construction firms and contractors. In its statement, Dubai said it will use some of the $10 billion to meet the obligations of Dubai World's contractors, it is unclear how it plans to address the .

Earlier this week, Japan's The Nikkei newspaper reported that Dubai owes Japanese nonfinancial companies around $7.5 billion. On Friday, British consulting and business group Mouchel Group PLC (MCHL.LN) said it would close its Dubai operations, saying there was uncertainty over the recovery of GBP10 million it is owed.

"What now remains to be seen is how Dubai World, and the Government of Dubai will restructure their respective remaining liabilities," said Faisal Ghori at ME Ventures.