By Barnaby Mason BBC diplomatic correspondent

Colonel Gaddafi's son has said Libya is responsible for the man convicted of the Lockerbie bomb attack - but not for his actions.

Seif al-Islam Gaddafi also said he believed the Libyan convicted of the bombing, Abdel-Baset al-Megrahi, was innocent and had been let down by his lawyer during the appeal.

Seif al-Islam Gaddafi: Idealistic vision

His personal view was that the Libyan Government would pay compensation, but not say it was responsible for the bombing.

"We admit, we have to admit we are responsible for (convicted bomber) Abdel-Baset al-Megrahi," he told the BBC.

"Why? Because he is a Libyan official working for the Libyan Airlines. But we are not responsible for his actions."

Talks are going on between Libyan, British and US officials about a possible compensation package for the relatives of the 270 people who were killed in the attack on Pan Am flight 103 in December 1988.

Al-Megrahi was sentenced to 20 years for the bombing and is serving his sentence in Scotland.

The key demand of the United States and Britain is that Libya itself should admit responsibility.

Global vision

Mr Gaddafi has been involved in the last couple of years with efforts to free Western hostages - first of all people held by Muslim guerrillas in the southern Philippines, more recently captives of the Taleban in Afghanistan.

He says he does not act for the Libyan Government but as head of the Gaddafi Foundation known as Charity.

In a speech at the Royal Institute of International Affairs in London, Mr Gaddafi set out an idealistic vision of how ethnic and religious conflicts could be resolved through federal democracy like that in Switzerland.

Using a projector, he showed a map of a Federal Republic of the Holy Land where Arabs and Jews would live in harmony.

It would be made up of several states - including one centred on Tel Aviv bearing the name Sharon.

Another map proposed a Greater India taking in Pakistan, Bangladesh and Sri Lanka, thus solving the Kashmir dispute at a stroke.

Mr Gaddafi's ideas echoed his father's many grandiose plans for Arab and African union - which have got nowhere.