Terror suspects seek Australian jihad, say police

CANBERRA - Police and intelligence agencies were last night continuing their investigations into an alleged terror group planning "catastrophic" attacks on Australia after the arrests of 16 men in Sydney and Melbourne.

One man was critically shot in the neck in a gunfight near a Sydney mosque, and police said early morning raids on homes in the two cities yesterday uncovered chemicals of the kind used to manufacture the bombs that brought devastation to London.

The injured man was shot after first firing at police, federal Justice Minister Chris Ellison said.

Police claim those arrested in the anti-terror raids, allegedly led by radical Islamic cleric Abdul Nacer Benbrika, had also discussed suicide bombings in a jihad, or holy war, that would kill innocent Australians.

The arrests, all involving Australian citizens, raised fears of homegrown terrorism, already heightened by federal police warnings that as many as 60 known terrorists were under surveillance.

Nine men appeared in a Melbourne court yesterday on charges that included belonging to, or leading, a terrorist organisation and conspiracy to commit acts of terrorism. Further charges are expected.

In Sydney, seven men were refused bail. The men did not appear in court.

The raids, carried out by hundreds of heavily armed police supported by helicopters in Sydney and Melbourne, followed a three-year operation involving police, the Australian Security Intelligence Organisation and other agencies that prompted Prime Minister John Howard to rush through new powers of arrest last week.

"We believe that we have disrupted a large-scale operation which, had it been allowed to go through to fruition, we certainly believe would have been catastrophic," said New South Wales Police Commissioner Ken Moroney.

New South Wales Premier Morris Iemma said: "Today's events leave us in no doubt at all of the need to be vigilant and unceasing in our efforts against the threat of terrorism. That threat is real and dangerous."

Mr Howard declined to comment on the details of the operation, but said the raid vindicated his decision to push new anti-terrorism laws through the Senate against claims of political manipulation.

"This country has never been immune from a possible terrorist attack," he said. "It is important that we continue to mobilise all of the resources of the Commonwealth and the states to fight terrorism."

Yesterday's dramatic events followed an extensive, covert investigation named Operation Pandanus that Chief Superintendent Norm Hazzard, head of the NSW Police Counter-Terrorism Command, described as a game of cat-and-mouse in which both sides knew the other was watching.

Long before yesterday's raids, terror suspects were reported to have filmed key sites such as railway stations and the Stock Exchange and to have discussed attacks on such national icons as Sydney's Opera House and harbour bridge.

But Victorian Police Commissioner Christine Nixon said that although it was known an attack was being planned, the alleged terrorists' targets were not known.

The group the arrested men allegedly belonged to has not yet been named, but after an operation that produced more than 200 hours of telephone intercepts, chemicals, illegal firearms, computers and documents, police claim to have detailed knowledge of its structure.

Under the alleged leadership of Benbrika, also known as Abu Bakr - a public supporter of Osama bin Laden - the group is said to have been co-ordinated between Sydney and Melbourne, operating on a system of cells isolated from one another.

Police also claim it ran an operating fund, contributed to in part from car-stealing.

Some of the men are also alleged to have undertaken military-style training at Kinglake, on the northern fringes of Melbourne.

Most of the raids on the suspects' homes in the two cities passed without violence, but in the western Sydney suburb of Green Valley police shot a man in the neck after he allegedly fired at officers near a mosque.

Police had approached the man after a suspicious package was found near a shopping centre.

As bystanders gathered, a bomb-disposal robot manoeuvred towards the place where the man was shot to determine the backpack's contents.

After a delicate operation, police revealed the bag contained some papers and a handgun - in addition to the one used to fire at police - but no explosives.

NSW Assistant Police Commissioner Graeme Morgan defended the decision to shoot "in the urgency of the moment".

"There isn't time for niceties," he told ABC radio.

The suspect, in his 20s, had surgery and was in a stable condition last night under police guard in Liverpool Hospital. Police said the man would be charged.

In Melbourne Magistrate's Court yesterday prosecutor Richard Maidment, QC, said the nine accused in that city were committed to the cause of violent jihad, with intercepted discussions including bomb-making and "martyrdom" that would include the taking of innocent lives.

- Aditional reporting AAP