The family and friends of the Serbian paramilitary leader known as Arkan are due to pay their respects on Monday as speculation grows that Yugoslav President Slobodan Milosevic may have fallen out with his one time ally before his murder on Saturday.

Opposition politicians in Serbia have accused the government of President Milosevic of being behind the killing, and say a series of unsolved assassinations in Serbia adds weight to their calls for a change of government.

The largest opposition party in the country, the Serbian Renewal Movement, said it was convinced the assassination was state-sponsored. "This is another confirmation that we live in a country where state terrorism is practised", a party statement said.

In the aftermath of Saturday's assassination, observers say the Belgrade leadership's silence - official media barely mentioned the killing and police failed to issue a statement - also suggests that a rift had emerged between Mr Milosevic and Arkan.

Knew too much

Independent Belgrade media reported two months ago that Arkan - real name Zeljko Raznatovic - was considering defecting to the West and cutting a deal with the International War Crimes Tribunal at The Hague to testify against President Milosevic in exchange for immunity from prosecution.

Numerous politicians in the Balkans have speculated that the paramilitary leader was killed because he knew too much about Serbian crimes during the Yugoslav conflict.

"Unfortunately, he missed an opportunity to testify against President Milosevic. Someone was making sure that one of the key people who knew too much should not live too long," said Mirza Hajric, adviser to the Bosnian presidency.

Terse statement

Arkan was shot dead along with two other people in the lobby of the Belgrade Intercontinental hotel. The gunmen escaped. The only official statement was a tersely worded report by the investigating judge, identifying the victims as Arkan and two of his associates.

His funeral is scheduled for Wednesday.

Arkan led the notorious Tigers paramilitaries, who were part of the Serb Volunteer Force operating in Bosnia and Croatia and allegedly in Kosovo. He was also a powerful figure in the Serbian underworld and was believed to have amassed wealth from war profiteering.

In the past he had been closely associated with Milosevic and is thought to have been employed by the Serbian Interior Ministry for much of the Yugoslav conflict. As such, he would have been party to the chain of command for many of the alleged war crimes committed by the regular army and paramilitary forces.

International regrets

Correspondents say Arkan would have been a valuable witness against Milosevic at the International Tribunal.

Britain and the United States have said they take no satisfaction from the murder of Arkan, saying that they would have preferred him to stand trial in the Hague court.

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