Bin Laden's letters in Al Qaida man's room

American and Pakistani agents hunting Osama bin Laden have found recent, hand-written letters from the Al Qaida chief to Khalid Sheikh Mohammed, captured last weekend, officials said on Wednesday.

A senior Pakistani official said in Islamabad that Sheikh Mohammed, Al Qaida's third-ranking leader, had admitted being in contact with bin Laden in the last two months but denied knowing his hiding-place.

"But we believe he knows it and will come out with the truth during the interrogation by American agents,'' the security official said.

Despite the fact that Al Qaida operatives are trained to lie and sow confusion if captured, Pakistani authorities pointed to physical evidence that Sheikh Mohammed has been in contact with bin Laden.

Agents found a trove of Al Qaida documents in the room where Sheikh Mohammed was sleeping, including letters, a satellite telephone and a laptop computer containing coded e-mails.

"There is material like letters and other things, which were in possession of Khalid Sheikh Mohammed, that strongly suggest bin Laden is alive and may be hiding in the region,'' the official said. "Pakistani interrogators believe the writing in the letter matches that of bin Laden.''

However, other Pakistani intelligence officials said the letters from bin Laden had been intercepted en route. The same officials told Time magazine that agents had found internet cafes in Quetta used by Sheikh Mohammed to send coded messages to terror cells in Europe, America and Asia.

Faisal Saleh Hayat, Pakistan's interior minister, re-iterated official denials that bin Laden was in Pakistan and Sheikh Rashid Ahmed, the information minister, also denied that letters from bin Laden were found on Sheikh Mohammed.

However, a Pakistani intelligence source told Time that, for the first time since bin Laden escaped from his Afghan stronghold of Tora Bora in December 2001, his pursuers have been able to confirm he is alive and hiding "somewhere in northern Pakistan''.

Bin Laden is thought to be in the tribal-controlled border region of northern Pakistan, or perhaps even in the capital, Islamabad, or 20 miles away in Rawalpindi, where Khalid Sheikh Mohammed was captured.

One intelligence source said they believed bin Laden's four wives and more than a dozen children were probably being given shelter in Iran by the Revolu-tionary Guards, despite the longstanding antipathy between Shi'ite Iran and the Sunni Muslims who dominate Al Qaida.

One intelligence official in Peshawar said: "We think bin Laden will break cover after Mohammed's capture and, when he does, we stand a good chance of catching him.''

Pakistani officials said they were so hopeful Khalid Sheikh Mohammed knew bin Laden's whereabouts that, after locating him last week, they held off from arresting him for eight hours, instead tailing him through Rawalpindi in the hopes that he might be visiting his chief.

Mohammed is being interrogated by the CIA in an undisclosed location.

Though the Bush adm-inistration rejects accusations that Mohammed faces torture as the CIA races to find out what he knows about imminent terror attacks, intelligence officials have confirmed that the 37-year-old Kuwaiti does face everything from sleep deprivation to what one called "a little bit of smacky-face''.

© The Daily Telegraph