Britain was offering to sell arms to the Argentinian dictatorship just three days before the invasion of the Falkland Islands, newly released documents in the National Archive show. The British Defence Attaché in Buenos Aires sent a telegram to the Ministry of Defence in London on 29 March 1982 saying that the Argentine air force had an "interest in acquiring extra squadron bombers". The British Defence Attaché planned to meet the head of the Argentine air force the "next week" to discuss the sale.

The subject of that meeting – obviously cancelled when Argentina invaded the islands on 2 April – was the sale of Canberra jet bombers and the refurbishment of other bombers that Britain had previously sold to the regime. "BAe [British Aerospace] is committed to making a proposal [to refurbish the planes] … if all goes well here BAe could move further up the class in time," the Defence Attaché wrote.

The documents show that British arms sales to Argentina's junta, notorious for its abuses of human rights, jumped after Margaret Thatcher came to power. Arms sales rose from £4.9m in 1978 to £62.6m in 1979; £46.7m in 1980 and £12.5m in 1981. Margaret Thatcher's government oversaw the delivery of two Lynx helicopters in 1979 and a Type-42 destroyer in 1980, contracts that had been agreed by the previous Labour government. Both the helicopters and the destroyer were used in the invasion of the Falklands.

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The Thatcher government also sold 22 Sea Dart surface-to-air missiles, radar spares, war support equipment for radar, laser rangefinder equipment, and mountings to attach heavy weapons to armoured personnel carriers. Robin Fearn, the head of the Foreign Office's South American Department, when approving the mountings in March 1981, wrote: "Armoured personnel vehicles have clear implications for human rights and we might be criticised if we were to be involved at any stage in their construction or armament. It is, however, unlikely that our involvement would ever become known."

The government continued to sell naval spares to the regime, headed by General Leopoldo Galtieri, until 12 days before the invasion on 2 April 1982. Lord Carrington, Foreign Secretary in the Thatcher government, resigned on 5 April 1982.

Contracts for a further eight Lynx Westland helicopters, an infra-red Linescan airborne surveillance system, and two Canberra aircraft were approved by Mrs Thatcher's ministers but delivery of these were cancelled after the invasion of the Falklands. However, just two weeks before the invasion, the Foreign Office was still planning to go ahead with the sale of the warplanes, one official writing: "It would seem inappropriate to supply medium bombers which could be deployed against the Falklands. However:

1) As the Argentines already have many suitable aircraft including 15 Canberras, another few would make no real difference to the capability; 2) Refusal to carry on selling previously approved equipment would call into question our reliability as an arms supplier with resulting damage not only to other sales prospects in Argentina but also elsewhere;

3) Political damage such a policy would have on Anglo-Argentine relations."

In early 1982, ministers also agreed to the sale of Rolls-Royce engines, as well as combustion air filters, exhaust silencers, gas turbine control equipment, window wipers, and gears for four German-made frigates for the Argentinian navy. Work was suspended during the conflict, but the government gave approval for the contract to be fulfilled after the end of the war.

In all, Labour and Conservative governments in the 1970s and early 1980s sold Argentina: two Type 42 destroyers; eight Canberra bombers; two Lynx helicopters; 135 Tigercat surface-to-air missiles; 44 Sea Cat surface-to-air missiles; 44 Sea Dart surface-to-air missiles; a Blowpipe anti-aircraft missile system with 120 surface-to-air-missiles; five Skyvan aircraft; one HS125 transport aircraft; 370 army vehicle radios; as well as electronic warfare equipment; a Laser Rangefinder; "Marksman" gunnery trainers; ejector seats; periscopes; and ammunition.

In 1980-81, Mrs Thatcher's ministers also approved licences to sell the Argentinian military: a Vickers battle tank; a Stingray lightweight torpedo; spares for Browning machineguns; a shipborne torpedo launching system; Centaur half-track Land Rovers; a Vulcan bomber; and participation in a TNT factory. These deals only fell through when the Argentinians went with alternative suppliers.

Research by the Jubilee Debt Campaign shows that many of these arms sales were funded by British government loans and are part of the £45m debt that the current Argentinian government still owes to Britain.

The junta was responsible for the "disappearance" of an estimated 30,000 of its citizens. Opponents of the regime were tortured and killed and many of their bodies were dropped into the sea by Argentina's air force. Pregnant prisoners were killed after giving birth and their babies given to military families, a tragedy which has rocked Argentina in recent years as those children reach adulthood.

Mrs Thatcher's political fortunes were transformed when she recovered the Falklands. Some 255 British soldiers; 649 Argentinians and three civilians died in the 74-day conflict.