Arnaldo Chamorro, chief of staff in Paraguay’s agriculture ministry, told reporters that he had signed an agreement with representatives of the “United States of Kailasa”.

Kailasa is a fictional island country led by cult leader Nithyananda, who is wanted in India on charges of rape and abduction.

The agreement purported to establish diplomatic relations between the two countries and commit Paraguay to supporting recognition of Kailasa in the UN.

Mr Chamorro said officials from Kailasa had promised in return to assist with various projects, including agricultural projects, The Guardian reports.

He was sacked the next day and Paraguay has repudiated its supposed commitments to Kailasa.