The government has made it very clear that it would accept any decision by the courts or the heirs of the dead men on the issue of US national Raymond Davis, Gilani said while addressing the National Seerat Conference, a gathering of clerics and religious scholars.

"The matter can be resolved if the relatives (of the dead men) grant a pardon or the court decides. We have no role in the matter," Gilani said. Davis' case was before the courts, which would decide the matter after evaluating evidence on whether he has diplomatic immunity, he said.

"Davis also has a lawyer, he will present his case and then the court will decide whether he has immunity or not," he added. Gilani's comments came as media reports said that the US and Pakistan may be nearing an arrangement to repatriate Davis and that the Pakistan government is expected to concede in court that the American qualifies for diplomatic immunity under the Vienna Convention.

The Dawn newspaper said in a report today that the government's counsel is expected to testify on Davis' diplomatic status when the Lahore High Court reconvenes tomorrow. Gilani, however, told the gathering, "The government has never asked the Foreign Ministry to write any summary on the issue and the Foreign Secretary spelt out the government's position. It is now for the courts to interpret these things".

"Had the government bowed before any pressure, US President (Barack) Obama would have had no need to appear on television asking for Davis' immunity," he said, referring to Obama's call for Davis to be freed during a news conference yesterday. Gilani said a "murder" had been committed and the clerics could suggest a solution.

"We are facing difficult decisions. There is a political price. If we take it, then the people do not support us, and if we don't do, it the world does not support us," he added. "We are caught between the devil and the deep sea. This needs wisdom. We will do whatever is in the interest of the country and the nation," Gilani said against a backdrop of increasing US pressure to free Davis. Gilani said his government would not do anything that harms national interests.

Shortly after addressing the gathering, Gilani met US Senate Foreign Relations Committee Chairman John Kerry, who has been sent to Pakistan by the Obama administration to discuss ways to resolve the tense standoff over Davis.

Speaking on behalf of the US administration, Kerry announced that the Department of Justice would conduct a thorough criminal investigation into the shooting incident involving Davis despite his immunity.

Pakistani leaders have rebuffed several US demands to free Davis, who was arrested in Lahore on January 27 after he shot and killed two men he claimed were trying to rob him. Pakistani police have rejected Davis' claim that he acted in self-defence and accused him of committing murder.