The escape of the spy to the US and the theft of codes from the defence research organisation are apparently unrelated, although both occurred under the previous Hindu nationalist government.

Details became public only last week after the new, Congress party-led coalition government came to power.

The theft of hard disks containing codes from the Defence Research and Development Organisation would have compromised military and intelligence communications.

But analysts insist the case of the missing spymaster, Rabinder Singh, a top official in the Research and Analysis Wing external intelligence agency, would have a far greater impact on the regional intelligence and security environment.

This could have significant implications in the region for US President George W. Bush's 'war on terror'.

Security analyst Ajay Sahni said: 'Indian intelligence has provided critical inputs for American anti-terror operations not just in Pakistan, but also in other parts of the world.

'But the discovery that the Americans successfully penetrated our intelligence setup could make our guys clam up, seriously compromising Indo-US intelligence co-operation.'

It turns out Mr Singh was not only passing secrets to the CIA about Indian security matters relating to Pakistan and other South Asian countries, but was also helped by the agency to escape from New Delhi, via Nepal, on a US passport.

He and his wife Pammi were believed to be in the US, where his son and daughter were already resident.

Mr Singh oversaw intelligence operations in a swathe of Asian countries from Thailand to Japan.

He aroused suspicions within the agency four months ago due to his extreme curiosity about South Asian operations.

The spymaster was put under surveillance, but despite being caught taking files from the office he was neither sacked nor arrested.

'The agency may have been extra cautious because he enjoyed powerful political patronage,' said an intelligence source.

But he was also considered 'vulnerable', since his daughter had been seriously injured in a traffic accident a few years ago, and was having expensive medical treatment in the US.

His decision to become a CIA 'mole' could have been provoked by the need for funds for his daughter's medical care.

A month ago, Mr Singh and his wife dodged sleuths watching his house, drove to Kathmandu and flew out on US passports.

While Mr Singh's case has created a sensation, it has been played down by the defence ministry.

Analysts said the codes could have been for communications but they were not of high military value.

The Times of India also quoted a source saying the stolen disks did not contain any data relating to India's nuclear command and control, or strategic forces command.