The federal government has accepted Bob Rae's recommendation Wednesday to hold a focused inquiry into the Air India bombings, and wants the former Ontario premier to conduct the probe.

"We believe that the understanding that he has of the context of this tragedy and the factual underpinnings that he has worked to comprehend will help him enormously," Deputy Prime Minister Anne McLellan said shortly after Rae released his report.

Rae said questions still need to be answered two decades after the "mass murder." He recommended a streamlined inquiry with a single commissioner and a mandate to conduct a "timely and efficient" probe.

Bob Rae speaks at a news conference after releasing his report recommending an inquiry to answer questions about the 1985 Air India bombing. (CP photo)

The former Ontario NDP leader and former NDP MP, rejected the idea of a full-scale judicial inquiry into the bombings that killed 331 people, saying he was worried it would turn into a "circus of lawyers."

"My conclusion...is that the fundamental objective of an inquiry has to be lessons learned. How did these things go wrong, are they still going wrong and how can we make sure they are fixed?" Rae said.

The Liberal government had asked Rae to look into whether Ottawa should call a public inquiry over the Air India investigation and prosecution after two suspects in the attack were acquitted.

"There needs to be a further inquiry," he said. "I'm also very concerned that the inquiry not go off the rails."

Rae said the inquiry should not focus on who is responsible for the bombings, saying it is impossible to conduct a quasi-criminal trial.

He said it should focus on four areas:

• Whether the assessment of Sikh terrorism was adequate in light of available information.
• Whether the RCMP and CSIS co-operated adequately in the investigation.
• The relationship between intelligence gathered and evidence presented at trial.
• Any breaches of airport security and if those issues have been addressed.

"This was a mass murder," said Rae. "This was a bombing attack that was carried out on Canadian civilians. And the consequences of that have to be understood by the people of Canada."

During Question Period, Conservative Leader Stephen Harper dismissed Rae's report as "wishy-washy." He said the government should have followed the wishes of Parliament,which passed a motion seven months ago calling for a full judicial inquiry.

Last March, millionaire Sikh businessman Ripudaman Singh Malik and sawmill worker Ajaib Singh Bagri, both from British Columbia, were found not guilty of bombing Flight 182 off the coast of Ireland en route from Toronto to India via London. The bombing killed 329 people, including many Canadians of Indian descent.

The two were also acquitted of planting a bomb in a suitcase loaded aboard another Air India flight in June 1985. The explosion killed two baggage handlers at Japan's Narita airport.

The B.C. judge hearing the case said he could not convict the suspects based on the evidence presented by the Crown.

Angry relatives countered by accusing police and the Crown of bungling the investigation, citing their inability to infiltrate Vancouver's close-knit Sikh community and the fact that key documents in the case were destroyed before it came to trial.

Lata Pada, a spokeswoman for the families of victims, said she was "encouraged" that their demands for answers will be addressed.

But Pada, a Toronto dancer who lost her husband and two daughters in the tragedy, said the inquiry would be incomplete and ineffective unless it investigates terrorism-related issues in Canada, including their financing and support in the country.