The alleged extremist, one of seven on trial for plotting to blow up British targets, was also said to have suggested poisoning takeaway food and sabotaging BT.

The claim was made by an American supergrass said to have links to al-Qaeda, testifying against his alleged former accomplices. He said another defendant attended a talk given by Abu Hamza al-Masri, the jailed cleric, where “video wills” made by the September 11 attackers were praised.

In his second day of evidence, Mohammed Babar described his first meetings in Pakistan with three of the men, accused of conspiring to cause an explosion in Britain.

He said his initial contact with Waheed Mahmood, 34, from Crawley, was via the internet. Babar’s e-mail address was pleasureofallah. yahoo.com.

Babar, the key prosecution witness, then met Mr Mahmood at the latter’s house in Pakistan, with other British men including Salahuddin Amin, 31, of Luton, and Anthony Garcia, 24, of Ilford, East London, who are also on trial.

Fired up for jihad (holy war), the men were said to be keen to fight in Afghanistan but were told by Mr Mahmood that this was not possible — the country was closed to foreigners.

Mr Mahmood, who worked for Transco National Grid, then allegedly gave examples of possible British targets to his accomplices. Some were intended to cause maximum financial damage by hitting utilities or telecommunication plants.

The court was told that other suggestions included taking a job as a beer-seller at a football stadium, smuggling in poison in a syringe. Babar said Mr Mahmood claimed that he had already sold toxic burgers from a mobile van.

Another plan was to distribute leaflets for a fictional take-away restaurant, then deliver poisoned food to houses.

While in Britain with Omar Khyam, 24, from Crawley, West Sussex, Babar heard a talk by Abu Hamza, who he met the next year.

Babar had been in Britain in an unsuccessful attempt to raise funds, during which he visited some of the defendants in Crawley.

While in Pakistan he said he buried a cache of weapons outside Punjab University in Lahore. This comprised AK47s, magazines, about 3,000 rounds of ammunition and grenades. He showed it to Mr Mahmood, who later contacted him asking about the weapons, but he ignored his e-mail. Mr Amin and Mr Mahmood also wanted Babar to create fake identification cards for them.

The witness told the court that there was conflict at that time between Muslims from Crawley and those from East London about who was working for whom. Both Mr Khyam and Mr Amin said that they were working for Abdul Hadi, the No 3 in al-Qaeda.

The group also visited Malakand, a remote mountainous area of Pakistan near the border with Afghanistan, with the intention of setting up their own explosives training camp.

Mr Amin, Mr Mahmood, Mr Khyam, his brother Shujah Mahmood, 18, and Jawad Akbar, 22, all from Crawley, West Sussex, and Mr Garcia and Nabeel Hussain, 20, of Horley, Surrey, deny conspiring to cause an explosion likely to endanger life. Mr Khyam, Mr Garcia and Mr Hussain deny possessing 600kg of fertiliser for the purposes of terrorism. Mr Khyam and Shujah Mahmood deny possessing aluminium powder for the purposes of terrorism.

The trial continues.

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