WASHINGTON: US Secretary of State Hillary Clinton assured Pakistan on Wednesday that a US inquiry to determine the cause of the Jan 27 incident would continue despite Raymond Davis's release.

Some media reports claimed that the Obama administration had paid more than $2 million in “blood money” to the victims' families to get him out. But the White House refused to confirm the payment.

“We have no information” to confirm that “blood money” was paid to the families, White House Press Secretary Jay Carney told reporters.

“We also have a Department of Justice investigation that has begun into what happened in Lahore,” said Secretary Clinton in a statement issued by her office.

“And we have communicated our strong support for the relationship between Pakistan and the United States which we consider to be of strategic importance,” she said. “We are looking forward to continuing to strengthen it based on mutual respect and common interest.”

Secretary Clinton made no reference to the blood money, saying instead that “the families of the victims of the January 27th incident pardoned Mr Davis and we are very grateful for their decision”.

The US, she said, appreciated the actions that they took which enabled Mr Davis to leave Pakistan and head back home.

The White House said it also welcomed the release, which followed “the families' decision to pardon Mr Davis in accordance with Pakistani law”. Asked about comments by lawyers for the victims' families that they were paid by either the US or the Pakistani government, Mr Carney said: “I don't have any information that would corroborate that.”

In a separate statement, John Kerry, chairman of the US Senate Foreign Relations Committee who visited Pakistan last month to negotiate Mr Davis's release, said: “This was a very important and necessary step for both of our countries to be able to maintain our relationship and remain focused on progress on bedrock national interests.”

He added: “I'm deeply grateful for the Pakistani government's decision. We deeply regret the loss of life that led to this difficulty in our relationship and the demonstrations on Pakistan's streets.”

But he noted that neither country could afford for this tragedy to derail their vital relationship.

“We look forward to working with Pakistan to strengthen our relationship and confront our common challenges,” the senator said.

Meanwhile, the US media reported that the terms of the deal were finalised during Senator Kerry's visit but both governments waited for the tensions to lower before announcing Mr Davis's release. —Anwar Iqbal