The official Dutch inquiry into the 1995 Srebrenica massacre, released last week, contains one of the most sensational reports on western intelligence ever published. Officials have been staggered by its findings and the Dutch government has resigned. One of its many volumes is devoted to clandestine activities during the Bosnian war of the early 1990s. For five years, Professor Cees Wiebes of Amsterdam University has had unrestricted access to Dutch intelligence files and has stalked the corridors of secret service headquarters in western capitals, as well as in Bosnia, asking questions.

His findings are set out in "Intelligence and the war in Bosnia, 1992-1995". It includes remarkable material on covert operations, signals interception, human agents and double-crossing by dozens of agencies in one of dirtiest wars of the new world disorder. Now we have the full story of the secret alliance between the Pentagon and radical Islamist groups from the Middle East designed to assist the Bosnian Muslims - some of the same groups that the Pentagon is now fighting in "the war against terrorism". Pentagon operations in Bosnia have delivered their own "blowback".

In the 1980s Washington's secret services had assisted Saddam Hussein in his war against Iran. Then, in 1990, the US fought him in the Gulf. In both Afghanistan and the Gulf, the Pentagon had incurred debts to Islamist groups and their Middle Eastern sponsors. By 1993 these groups, many supported by Iran and Saudi Arabia, were anxious to help Bosnian Muslims fighting in the former Yugoslavia and called in their debts with the Americans. Bill Clinton and the Pentagon were keen to be seen as creditworthy and repaid in the form of an Iran-Contra style operation - in flagrant violation of the UN security council arms embargo against all combatants in the former Yugoslavia.

The result was a vast secret conduit of weapons smuggling though Croatia. This was arranged by the clandestine agencies of the US, Turkey and Iran, together with a range of radical Islamist groups, including Afghan mojahedin and the pro-Iranian Hizbullah. Wiebes reveals that the British intelligence services obtained documents early on in the Bosnian war proving that Iran was making direct deliveries.

Arms purchased by Iran and Turkey with the financial backing of Saudi Arabia made their way by night from the Middle East. Initially aircraft from Iran Air were used, but as the volume increased they were joined by a mysterious fleet of black C-130 Hercules aircraft. The report stresses that the US was "very closely involved" in the airlift. Mojahedin fighters were also flown in, but they were reserved as shock troops for especially hazardous operations.

Light weapons are the familiar currency of secret services seeking to influence such conflicts. The volume of weapons flown into Croatia was enormous, partly because of a steep Croatian "transit tax". Croatian forces creamed off between 20% and 50% of the arms. The report stresses that this entire trade was clearly illicit. The Croats themselves also obtained massive quantities of illegal weapons from Germany, Belgium and Argentina - again in contravention of the UN arms embargo. The German secret services were fully aware of the trade.

Rather than the CIA, the Pentagon's own secret service was the hidden force behind these operations. The UN protection force, UNPROFOR, was dependent on its troop-contributing nations for intelligence, and above all on the sophisticated monitoring capabilities of the US to police the arms embargo. This gave the Pentagon the ability to manipulate the embargo at will: ensuring that American Awacs aircraft covered crucial areas and were able to turn a blind eye to the frequent nightime comings and goings at Tuzla.

Weapons flown in during the spring of 1995 were to turn up only a fortnight later in the besieged and demilitarised enclave at Srebrenica. When these shipments were noticed, Americans pressured UNPROFOR to rewrite reports, and when Norwegian officials protested about the flights, they were reportedly threatened into silence.

Both the CIA and British SIS had a more sophisticated perspective on the conflict than the Pentagon, insisting that no side had clean hands and arguing for caution. James Woolsey, director of the CIA until May 1995, had increasingly found himself out of step with the Clinton White House over his reluctance to develop close relations with the Islamists. The sentiments were reciprocated. In the spring of 1995, when the CIA sent its first head of station to Sarajevo to liaise with Bosnia's security authorities, the Bosnians tipped off Iranian intelligence. The CIA learned that the Iranians had targeted him for liquidation and quickly withdrew him.

Iranian and Afghan veterans' training camps had also been identified in Bosnia. Later, in the Dayton Accords of November 1995, the stipulation appeared that all foreign forces be withdrawn. This was a deliberate attempt to cleanse Bosnia of Iranian-run training camps. The CIA's main opponents in Bosnia were now the mojahedin fighters and their Iranian trainers - whom the Pentagon had been helping to supply months earlier.

Meanwhile, the secret services of Ukraine, Greece and Israel were busy arming the Bosnian Serbs. Mossad was especially active and concluded a deal with the Bosnian Serbs at Pale involving a substantial supply of artillery shells and mortar bombs. In return they secured safe passage for the Jewish population out of the besieged town of Sarajevo. Subsequently, the remaining population was perplexed to find that unexploded mortar bombs landing in Sarajevo sometimes had Hebrew markings.

The broader lessons of the intelligence report on Srebrenica are clear. Those who were able to deploy intelligence power, including the Americans and their enemies, the Bosnian Serbs, were both able to get their way. Conversely, the UN and the Dutch government were "deprived of the means and capacity for obtaining intelligence" for the Srebrenica deployment, helping to explain why they blundered in, and contributed to the terrible events there.

Secret intelligence techniques can be war-winning and life-saving. But they are not being properly applied. How the UN can have good intelligence in the context of multinational peace operations is a vexing question. Removing light weapons from a conflict can be crucial to drawing it down. But the secret services of some states - including Israel and Iran - continue to be a major source of covert supply, pouring petrol on the flames of already bitter conflicts.

· Richard J Aldrich is Professor of Politics at the University of Nottingham. His 'The Hidden Hand: Britain, America and Cold War Secret Intelligence' is published in paperback by John Murray in August.

richard.aldrich@nottingham.ac.uk