(Rptg, with corrections in para 1)

ISLAMABAD, June 21 (Reuters) Pakistan's minister of religious affairs should be dismissed for suggesting suicide bombs were a justified response to a British knighthood for Salman Rushdie, former prime minister Benazir Bhutto said.

Rushdie, whose novel ''The Satanic Verses'' outraged many Muslims around the world, was awarded a knighthood last week for services to literature in Queen Elizabeth's birthday honours list.

Muslims say the novel, published in 1988, blasphemed against the Prophet Mohammad and ridiculed the Koran and events in early Muslim history.

Pakistan and Iran have protested against the honour and protests have been held in various parts of Pakistan and in Malaysia.

On Monday, Pakistan's parliament adopted a resolution condemning the knighthood and said Britain should withdraw it.

Religious Affairs Minister Mohammad Ejaz-ul-Haq told the assembly insults to Islam were at the root of terrorism, and added that if someone committed a suicide bombing to protect the honour of the Prophet Mohammad, his act was justified.

He later said he did not mean such attacks would be justified but was merely saying militants could use the knighthood as a justification for violence.

But Bhutto said Haq had justified suicide attacks on a British citizen.

''The minister ... son of a previous military dictator who had patronised extremist groups, had done a great disservice both to the image of Islam and the standing of Pakistan by calling for the murder of foreign citizens,'' Bhutto said in a statement.

Haq is the son of military president Mohammad Zia-ul-Haq, whose policies of Islamisation in the 1980s are often blamed for sowing the seeds of Islamist militancy.

Zia overthrew Bhutto's father, then prime minister Zulfiqar Ali Bhutto, in 1977. Bhutto was executed two years later.

Benazir called on the government to dismiss Haq.

''While the sentiments of a majority of Muslims was outraged that the author ... received a knighthood, Islam did not permit murder and nor did the law allow suicide killings for those with divergent views,'' she said.

Britain said it was deeply concerned about Haq's comments, adding that nothing could justify suicide bombings.

Haq has twice clarified his comments, stressing he had never meant to justify suicide attacks.

The speaker of the National Assembly expunged his comments from the record of proceedings, citing the national interest.

Bhutto has lived in self-imposed exile for nearly a decade and faces corruption accusations both at home and abroad.

She denies corruption and has vowed to return home for a general election due around the end of the year.

REUTERS LPB PM1405