The release of the Lockerbie bomber was linked by the Government to a £400 million arms-export deal to Libya.

The release of the Lockerbie bomber was linked by the Government to a £400 million arms-export deal to Libya, according to secret correspondence obtained by The Sunday Telegraph published on Sunday.

"An email sent by the then British ambassador in Tripoli details how a prisoner transfer agreement would be signed once Libya “fulfils its promise” to buy an air defense system," the daily said.

The disclosure is embarrassing for members of the then Labour government, which always insisted that Abdelbaset al-Megrahi’s release was not linked to commercial deals.

It added that the email, "which contained a briefing on the UK’s relations with Colonel Muammar Gaddafi’s regime, was sent on June 8 2008 by Sir Vincent Fean, the then UK ambassador, to Tony Blair’s private office, ahead of a visit soon after he stepped down as prime minister."

The briefing, which runs to 1,300 words, contains revealing details about how keen Britain was to do deals with Gaddafi.

The release of Megrahi in August 2009 caused a huge furor, with the Government insisting he had been released on compassionate grounds because he was suffering from terminal cancer, and that the decision was taken solely by the Scottish government.

Megrahi had been convicted in 2001 of the murder of 270 people when PanAm flight 103 from London to New York blew up over Lockerbie in Scotland in 1988. It remains Britain’s single worst terrorist atrocity.