Pakistan said Thursday it had taken all "appropriate action" to break up the underground nuclear network run by its former chief nuclear scientist Abdul Qadeer Khan.

Foreign Minister Khursheed Kasuri made the remarks one day after a British newspaper alleged Khan's network may still be in operation. The Guardian report cited an unidentified European Union source.

"Pakistan is very sorry and is very upset and has taken all appropriate action in dismantling the underground network," Kasuri said. "Dr. A.Q. Khan has fallen from the high pedestal that he had," he said, adding that Khan had already been "treated very harshly."

Kasuri was speaking after meeting Taro Aso, the Japanese minister for foreign affairs, in Islamabad.

Khan, the founding father of Pakistan's nuclear weapons program, acknowledged in February 2004 that he gave sensitive nuclear technology to Iran, North Korea and Libya. President Bush has labeled North Korea and Iran part of an "axis of evil" and analysts say both countries pose a potential nuclear threat.

President Gen. Pervez Musharraf pardoned Khan in 2004. He has been under house arrest amid tight security in Pakistan's capital.

Kasuri said Pakistan had already shared information with Japan, the United States and several European countries on Khan's network.

The now disgraced Khan is still hailed as a hero by many in Pakistan for turning it into an atomic power to match rival India. Both countries carried out nuclear tests in 1998.

During a two-day visit ending Thursday, Aso met Pakistan's prime minister and Musharraf.

The two countries agreed to set up a working group for discussions on disarmament, nonproliferation, dual use technology, the peaceful uses of nuclear energy, nuclear safety and space technology, the Foreign Ministry said in a statement.

At their meeting, Kasuri and Aso also signed an agreement under which Japan will provide loans to Pakistan to aid recovery from the Oct. 8 quake that left about 87,000 people dead and 3.5 million homeless in northwestern Pakistan and Pakistani-controlled Kashmir.

Japan has provided $200 million in quake relief to Pakistan, Kasuri said.