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WASHINGTON - In the first week of October 1999, Ted Stevens had the government of Pakistan in a delicate position.

The Pakistanis were desperate for the removal of powerful military and economic sanctions imposed after it conducted nuclear tests in 1998. Many hundreds of millions of dollars in trade were at stake.

Stevens was the chairman of the conference committee that was considering allowing that change. But first, according to Capitol Hill sources, he made it clear he wanted Pakistan to resolve a multi-million dollar dispute with an Alaska construction and engineering company, VECO, owned by his close friend, Bill Allen.

It was VECO that was at the heart of the Stevens indictment Tuesday, and prosecutors outlined hundreds of thousands of dollars in financial favors that VECO allegedly did for Stevens.

What was less clear was what Stevens did for VECO, though the indictment mentions without elaborating that VECO asked for his help with projects in Pakistan and Russia, among other favors.

Here is one interaction between Stevens, Pakistan and VECO, some of which was first reported by the Los Angeles Times in June 2003.

The sanctions removal provision appeared to be sailing through Congress - attached to the Defense Department appropriations bill which was moving through Stevens' conference committee. But it ran into trouble with Stevens, who was also the powerful chairman of the Senate Appropriations Committee and its Defense Department appropriations subcommittee.

Stevens raised the issue of a contract dispute that VECO was having with Pakistan over payment for its participation in construction of a pipeline. He wanted Pakistan to resolve it.

Some of the people involved maintain that Stevens said the he would not pass the provision until VECO was taken care of while others said his intervention was more benign.

But the bottom line was that Pakistan and its allies took it as a threat and quickly phoned top officials in Pakistan to try to work things out.

"Senator Stevens brought the problem to our attention," said Pakistan's then lobbyist, former Congressman Charlie Wilson in an interview in 2003. "It was a constituent complaint." A popular movie about Wilson was released last year.

Wilson did not see it as "a threat." He said he talked to the Pakistani embassy about it.

"His constituent had a just grievance with Pakistan," said Wilson at the time. "The truth is that Senator Stevens' constituent was right. ... Pakistan corrected it." Wilson could not be reached for comment Tuesday.

Stevens let the amendment go through on Oct. 7 after receiving assurances from Pakistan that it would let the World Bank arbitrate the dispute.

This was not the only time that Stevens took an official action to help VECO.

In the fall of 1999, Stevens earmarked $2.5 million in labor department training funds to train Russian oil field workers in Alaska.

Allen and VECO and others pushed for the grant because they were having a difficult time finding skilled workers for their oil and gas projects in the Sakhalin Island in the Russian Far East.

In addition to doing extensive remodeling on Ted Stevens' home, VECO paid his son, Ben, at least $364,000 in lobbying and consulting fees since 1996.

Ben, who was a state senator until last year, has also been ensnared in the VECO scandal but has not been charged.