Canadian police said on Monday they had arrested and charged two men with plotting to derail a Toronto-area passenger train in an operation they say was backed by al Qaeda elements in Iran.

"Had this plot been carried out, it would have resulted in innocent people being killed or seriously injured," Royal Canadian Mounted Police official James Malizia told reporters.

The RCMP said it had arrested Chiheb Esseghaier, 30, of Montreal, and Raed Jaser, 35, of Toronto in connection with the plot, which authorities said was not linked to last week's Boston Marathon bombings, which killed three and injured more than 200 people last week.

Neither is a Canadian citizen, and police did not reveal their nationalities. Two sources following the investigation said one of the two was Tunisian.

Canada's spy agency has long expressed concern about the possibility that disgruntled and radicalised Canadians could attack targets at home and abroad.

Police gave little detail about the alleged plotters, but said a tip from the Muslim community had helped their year-long investigation.

Esseghaier has been a doctoral student at the Institut National de la Recherche Scientifique near Montreal since 2010 and was about midway through his degree, the school said.

"He is doing a PhD in the field of energy and materials sciences," Julie Martineau, the school's director of communications, told Reuters.

A bail hearing for the two will take place in Toronto on Tuesday morning.

Malizia said there was no indication that the planned attacks, which police described as the first known al Qaeda- backed plot on Canadian soil, were state-sponsored.

US officials said the attack would have targeted a rail line between New York and Toronto, a route that travels along the Hudson Valley into New York wine country and enters Canada near Niagara Falls.

Canadian police said only that the plot involved a VIA train route in the Toronto area. VIA is Canada's equivalent of Amtrak and operates passenger rail services on track owned primarily by Canadian National Railway Company.

New York Police chief spokesman Paul Browne told Reuters that the NYPD and Commissioner Ray Kelly had been kept informed of the investigation from "early on."

JOINT OPERATIONS

Malizia said the RCMP believed the two had the capacity and intent to carry out the attack, but there was no imminent threat to the public, passengers, or infrastructure.

The plot is one of a handful of terrorism-related investigations involving Canadians or Canadian residents.

Police said earlier this year that Canadians took part in an attack by militants on a gas plant in Algeria in January, while Canadian and Somalia authorities are investigating whether a former University of Toronto student participated in a bomb attack on Mogadishu last week.

And in 2006, police arrested and charged nearly 20 Toronto-area men accused of planning to plant bombs at various Canadian targets. Eleven were eventually convicted.

"Today's arrests demonstrate that terrorism continues to be a real threat to Canada," Public Safety Minister Vic Toews told reporters in Ottawa.

"Canada will not tolerate terrorist activity and we will not be used as a safe haven for terrorists or those who support terrorist activities."

AL QAEDA IN IRAN

The Canadian authorities linked the two to al Qaeda factions in Iran, to the surprise of some security experts.

"The individuals were receiving support from al Qaeda elements located in Iran," Malizia said.

Iran did host some senior al Qaeda figures under a form of house arrest in the years following the September 11 attacks, but there has been little to no evidence to date of joint attempts to execute violence against the West.

However, a US government source said Iran is home to a little-known network of alleged al Qaeda fixers and "facilitators" based in the Iranian city of Zahedan, very close to Iran's borders with both Pakistan and Afghanistan.

The source said the operatives serve as go-betweens, travel agents and financial intermediaries for al Qaeda operatives and cells operating in Pakistan and moving through the area.

They do not operate under the protection of the Iranian government, which has a generally hostile attitude towards Sunni al Qaeda militants, and which periodically launches crackdowns on the al Qaeda elements, though at other times appears to turn a blind eye to them. – Reuters