ISLAMABAD, Pakistan - Pakistan on Friday angrily denied a newspaper report that its intelligence service helped plan a bombing of India's embassy in Kabul that killed at least 41 people, amid mounting allegations the secretive agency is aiding Islamic militants.

The New York Times reported that American intelligence agencies have concluded that members of Pakistan's powerful Inter-Services Intelligence were involved in the July 7 attack in the Afghan capital.

The report cited unnamed U.S. government officials. It said the conclusion was based on intercepted communications between Pakistani intelligence officers and militants who carried out the attack.

Pakistan's Foreign Ministry spokesman Mohammed Sadiq described the report as "total rubbish," saying there was no evidence of ISI involvement.

"The foreign newspapers keep writing such things against ISI, and we reject these allegations," he said by telephone from a summit of South Asian leaders in Sri Lanka.

Afghanistan has long accused the ISI of backing the Taliban-led insurgency wracking the country, despite Pakistan's support of the U.S.-led war on terror. The embassy bombing was the deadliest in Kabul since the 2001 ouster of the Islamist regime in a U.S. invasion.

Last week, India accused "elements of Pakistan" of being behind the blast and said it had put the four-year-old peace process between historic rivals India and Pakistan -- who have fought three wars since they won independence from Britain 60 years ago -- "under stress."

The latest accusations came as South Asian leaders -- including those from India, Afghanistan and Pakistan -- gathered for a meeting on regional cooperation in Sri Lanka.

Sri Lankan Foreign Minister Rohitha Bogollagama said Thursday the South Asian countries were expected to sign a pact to work together to fight terrorism and to freeze funds used for terror attacks.

A Bush administration official told The Associated Press on Wednesday that U.S. intelligence agencies suspect rogue elements in ISI of giving militants sensitive information that helps them launch more effective attacks from Pakistan's tribal regions bordering Afghanistan.

The official said that top CIA and U.S. military officials, including CIA Deputy Director Steve Kappes, traveled to Pakistan five days after the Indian Embassy attack to press their misgivings about apparent ties between militants and some mid-level ISI officials, amid mounting evidence initially collected by the United States and then corroborated by Indian intelligence.

A U.S. counterterror official said some Pakistani intelligence officers' support for the Jalaluddin Haqqani network, associated with both the Taliban and al Qaeda, is of particular and long-standing concern.

The New York Times report cited American officials as saying the embassy attack was probably carried out by members of the Haqqani network.

The report did not specify what kind of assistance the ISI officers allegedly provided to the militants, but said they had not been renegades, indicating that their actions might have been authorized by superiors.

This week, President Bush publicly praised visiting Prime Minister Yousuf Raza Gilani as a strong ally against terrorism. But according to a report in Pakistan's The News daily, Bush expressed concern over ISI elements leaking information to militants and asked Gilani who was controlling the spy agency.

The report quoted Pakistan's Defense Minister Chaudhry Ahmed Mukhtar.

ISI, which has been an important partner of the U.S. in capturing top al Qaeda suspects since 2001 -- including 9/11 attacks mastermind Khalid Sheikh Mohammed -- is formally under the control of Pakistan's prime minister, but all its senior officials are army officers.

On the eve of Gilani's visit to Washington, the government announced the powerful agency would now report to the interior minister -- the top civilian security official -- only to backtrack hours later. That confusion had led to pointed criticism of the government, which has struggled to define a coherent strategy for combating Islamic militancy since it took office after defeating supporters of President Pervez Musharraf in February elections.

The government has pursued peace deals with militants and tribes in Pakistan's volatile northwest. NATO and U.S. military complain that the talks and accompanying cease-fires have freed up militants to mount attacks across the border into Afghanistan.

American officials also worry that the lack of military pressure on militants inside Pakistan will only allow them to build their strength and give al Qaeda a chance to plot another 9/11-style strike in the West.