Rarely can Whitehall have seen such a display of mutual admiration. David Blunkett and his French counterpart, Nicolas Sarkozy, spent much of their joint appearance on 2 December at the Home Office searching for superlatives to describe the other. The reason: a deal to close the Sangatte refugee camp and stem the flow of asylum-seekers that has for so long exercised the Brits. The French, derided in the British press for their "indulgence", had finally changed their entire policy at the request of a neighbouring country.
The roles have been reversed on a different, but related, issue. Since the early 1990s, the governments and intelligence services of other countries - among them the Americans, the Egyptians and especially the French - have seen Britain as Europe's soft underbelly. They are exasperated by our approach to terrorism. They are frustrated at what they see as our leniency towards Islamic fundamentalists. They accuse our politicians of hypocrisy - even conspiracy. They contrast Tony Blair's rhetoric about the "war on terror" abroad with what they regard as his different approach at home.
In the 15 months since the attacks of 11 September, not a single person has been sentenced in Britain on charges directly relating to international terrorism, even though London is regarded as the international centre for Middle Eastern finance and media and has the fieriest Islamist clerics of any European capital.
The French call it "Londonistan", or the "international sanctuary for terrorism". They have grown used to hearing calls from the imams in British mosques, notably at Finsbury Park, just around the corner from Arsenal Football Club, for a "jihad" against the west. They cannot imagine how spiritual leaders such as Abu Hamza al-Masri or Omar Bakri Mohammed get away with saying what they say at prayers or on radio and television.
"The Islamists use Britain as a propaganda base but wouldn't do anything to a country that harbours them and gives them freedom of speech," says Camille Tawil, a terrorism expert at Al Hayat, the London-based Arabic daily newspaper. "It's only outside pressure that has made the British even begin to act."
That view is widely shared in the chancelleries of Europe and in Washington. Diplomats of "friendly" countries are worried about airing their criticisms in public, but privately many share them.
For the French, the problem lies in Britain's very different judicial system. In France's more inquisitorial system, judges take their lead from politicians and are part of the prosecuting process. In Britain, the more draconian governments try to become, the more the courts seek to assert their independence. Jean-Pierre Langellier, London correspondent for Le Monde, says the French elite is far less tolerant of diversity. "You have a multiculturalism that allows people to express and identify themselves in groups, which is incomprehensible in France."
A senior American official suggests the British are confused: "There is some sort of post-colonial self-loathing going on here. It looks like you're hiding behind legalistic knots to avoid having to deal with it."
Britain's incitement laws provide fertile ground for clever lawyers. Racial hatred is a crime, religious hatred not so. Inciting violence is a crime if it can be linked to a specific target or action, but not if it is a general call to arms. The justification of past events such as the "Towering Day in History", a celebration of the first anniversary of 9/11 by Omar Bakri's al-Muhajiroun group, is, to the dismay of outsiders, regarded as perfectly lawful.
British government officials say that the French and others have a "legitimate and long-standing frustration at our judicial processes". They point out that during the 1990s, after the collapse of communism but before 9/11, the British intelligence establishment devoted most of its resources to the terrorism threat from the IRA. In turn, they suggest, the French were less than forceful in taking on French-based militants from Lebanon fomenting the civil war there in the 1980s.
The two nations' security strategies differ greatly. The British, according to foreign security officials, decided after 11 September that "watchful tolerance" is the best way of keeping tabs on the mosques. "There is no point in driving groups underground or making martyrs of particular individuals," a British security official says. "But if we find important evidence we don't hold back."
They cite as an example the detention six weeks ago of Abu Qatada, a Palestinian self-styled spiritual leader who was granted leave to stay in Britain after arriving in 1993, claiming he was fleeing religious persecution. The raid on a council flat in Bermondsey, south-east London, came within days of his publication on the internet of an essay called "The Legal Vision for the September 11 Events", in which Qatada set out the "moral" case for the attacks. Qatada had disappeared from his home in December 2001. French officials alleged he was being held at an MI5 safe house. This was hotly denied by security sources but France continued to claim the British knew all along where he was. Other nations have complained that Britain did not take Qatada sufficiently seriously. He is sought by police in the United States, Belgium, Spain, France, Germany, Italy, Algeria and Jordan.
The case of Zacarias Moussaoui, the alleged "20th hijacker", is another source of contention. A French-Moroccan, Moussaoui lived in a flat in Brixton and attended lectures given by Abu Hamza and Abu Qatada. French sources opened a file on him in 1994. A French judge asked to interview him in his London flat. The Home Office refused permission. The inquiry was dropped. From London, Moussaoui went to the US; American authorities say he became an al-Qaeda operative there.
The conspiracy theories date back to the mid-1980s when the propaganda battle against the Soviet-backed regime in Afghanistan was reaching its peak. Western governments encouraged Islamic groups based in their countries to foment unrest and helped to arm the "liberation" struggle. The British were particularly keen on attempts to undermine Libya's Colonel Gaddafi. "They thought they were using the Islamists," says Al Hayat's Tawil. "In fact, the Islamists were using them."
The British deny the accusation of an informal "non-aggression pact" with Islamist oppositionists in the 1990s - whereby we allegedly let them act with impunity as long as they didn't launch any attacks on our soil. "It's certainly true we didn't appreciate the scale of the problem," says a security source. "But to suggest a quid pro quo is rubbish."
It is true, however, that during the 1990s rules about "extra-territoriality" were interpreted very strictly by the Brits. Fear-ful of being seen to curtail legitimate opposition to dictator- ships around the world, legislation seemed to define terrorist activity as relating only to attacks on the UK itself.
The current government says that is history. It points to two pieces of draconian legislation, the Terrorism Act 2000 and the Anti-Terrorism, Crime and Security Act 2001, as signs that all has changed. The more recent law introduced powers unprecedented not just in British history but also in current international practice, to detain people without charge if their presence in the UK is deemed "not to be conducive to the public good". The only caveat is that they must be foreign. Fourteen people have been picked up under these provisions. Two have agreed to return to their countries. The other 12 are being held indefinitely. Civil libertarians are appalled.
Much of the French fury is now directed at a single case. Rashid Ramda, an Algerian, came to Britain in 1992 and was granted asylum. Three years later he was arrested shortly after a series of bombings on the Paris Metro in which eight people died and more than 200 were injured. The Armed Islamic Group, GIA, an Algerian terror group later believed to have strong ties to al-Qaeda, claimed responsibility. The French accused Ramda of masterminding the attacks - of being the banker and logistics expert - and requested his extradition. He denies the charges. Two other suspects - SmaIn AIt Ali Belkacem and Boualem BensaId - were jailed in France for their part in the attacks.
Despite repeated French appeals, both Michael Howard and his Labour successor Jack Straw did not order Ramda's extradition. Within weeks of 9/11, Blunkett reversed that and signed the papers. Ramda appealed. His lawyer, Gareth Peirce, who successfully represented the Guildford Four and Birmingham Six, as well as a series of terrorist defendants more recently, argued that her client could not be guaranteed a fair trial in France. The assertion is based on evidence that BensaId had been the victim of police brutality during questioning. Bruises were found on his body and, after initially confessing and incriminating Ramda, he retracted his testimony.
On 27 June this year, the High Court overturned the Home Secretary's decision. It requested "a new evaluation, taking account of the security of the accused in the hands of the French authorities". In other words, the French could not be trusted. The French were livid. Imagine, they say, the reverse - if they refused to extradite an IRA suspect wanted for a series of bombings.
The British are embarrassed about the case. "The French are signatories to exactly the same human rights conventions. We can understand their frustration," says a Home Office source. Blunkett's people use the Ramda case in an attempt to justify radical changes to extradition procedures. The Extradition Bill, which will be debated in the Commons on 9 December, calls for "fast track" hearings, with automatic transfer of suspects within a common EU judicial space. Both Eurosceptics and human rights activists will oppose it. "We are very concerned that a funda-mental protection to ensure fair trial will disappear," says John Wadham, director of the human rights organisation Liberty.
It is hard to underestimate the importance of the case to French public opinion. Week after week, the London-based French press corps traipse down to Belmarsh Prison in Plumstead, south-east London. The British media have covered the trial only fleetingly.
With Blunkett by his side, Sarkozy called for "collaboration, not opposition" in these matters. "If you mistrust people you get nowhere," he said. The mistrust shows no sign of disappearing. French and American intelligence services are said now to be actively monitoring people in the UK. Indeed, one US official said that "Your surveillance is unrivalled. We couldn't get away with the number of cameras on every street corner that you have . . . But what you do with all that information is something quite different."
It is believed that the French were instrumental in alerting the British about Karim Kadouri, Rabah Kadre and Rabah Chekat-Bais, the three men of Maghrebi origin who were arrested in London early last month and are now in Belmarsh charged with possession of articles for the preparation, instigation and commission of terrorism acts.
Diplomatic pressure is making it harder than ever for the British to maintain their treasured balance between law and order and civil liberties. Until the epithet "Londonistan" disappears from the memos of foreign diplomats, Blunkett and Blair will know on which side they will want to err.