Babic was prime minister and president of the self-proclaimed rebel Serb statelet which during its four years of existence was called the Serb Autonomous District of Krajina and the Republic of Serb Krajina. In 2004 he was sentenced to 13 years in prison after he pleaded guilty to charges of persecution on political, racial or religious grounds as crime against humanity committed against Croat and other non-Serb civilians.
Babic said that Martic had publicly accepted the Vance plan, but that he was under instructions from Serbian President Slobodan Milosevic not to implement it. Instead of demilitarising the area, he changed the uniforms of Yugoslav People's Army (JNA) and Territorial Defence (TO) members into those of police and kept JNA tanks and heavy weaponry, the witness said.
Instead of implementing the part of the plan providing for the return of Croat civilians to UN-protected areas, Martic continued with the expulsion of the remaining Croats, Babic said.
Speaking about the Z-4 plan, which provided for autonomy for Serbs in the area of Knin and the full reintegration of western and eastern Slavonia, the witness said that in February 1995 Martic did not want to take into his hands a copy of the proposed plan offered to him in Knin by the Russian ambassador to Croatia.
Babic confirmed having personally signed the plan in August 1995, adding that the Croatian military and police operation "Storm" started two days later.
Prosecutor Alex Whiting said that the hearing would be completed on Tuesday, when Martic's defence counsel would start the cross-examination.
Martic, 60, is charged with 19 counts of crimes against humanity and violations of the laws and customs of war committed through the expulsion of Croat civilians from formerly occupied areas in 1991-95, war crimes in western Bosnia in 1994, and the shelling of Zagreb in May 1995.