LONDON – Prime Minister Gordon Brown said on Monday the public would give Prince Harry the "benefit of the doubt" over his home movie showing him calling army colleagues "Paki" and "raghead."
Brown said the 24-year-old royal, who is third in line to the throne, knew his language was unacceptable and his apology was sincere.
But the father of the Pakistani soldier who Harry called "our little Paki friend" said he could not accept the prince's apology, insisting that he should say sorry to the Islamabad government.
The News of the World newspaper on Sunday published the video clips made by Harry in 2006 while he was an army officer cadet.
The prince's office said Harry was extremely sorry for any offence caused.
"The sincerity of his apology cannot be doubted," Brown told GMTV television.
"It was a mistake, he has made the admission of that and, once he has made his apology, I think the British people are good enough to give someone who has actually been a role model for young people and has done well fighting for our country, gone into very difficult situations with bravery, I think they will give him the benefit of the doubt.
"I think Prince Harry knows that these comments are unacceptable.
"I think it is a genuine apology. These comments have no part in our life."
The Ministry of Defence said the prince's commanding officer would look into his remarks. However, he will not face a formal investigation.
Despite trying to shake off his "playboy prince" image through his charity work and military service in Afghanistan, Harry has repeatedly found himself in hot water for his comments and antics -- most infamously for wearing a Nazi uniform to a fancy dress party.
The latest embarrassing images were shot as Harry was waiting with his platoon in an airport departure lounge for a flight to a training exercise in Cyprus three years ago.
Touring the room with a video camera as his colleagues snooze, he spots a colleague whose family is of South Asian origin and says: "Anybody else around here?... Ah, our little Paki friend, Ahmed."
"Paki" is a racist term for Pakistanis or other South Asians and is thought to have been directed at Ahmed Raza Khan, who served with Harry at the prestigious Sandhurst military academy.
Harry's grandmother Queen Elizabeth II presented Khan with the Overseas Sword for being the best foreign cadet in April 2006.
The prince's office insisted he had used the term without malice.
"Prince Harry fully understands how offensive this term can be, and is extremely sorry for any offence his words might cause," a spokesman said.
"However, on this occasion three years ago, Prince Harry used the term without any malice and as a nickname about a highly popular member of his platoon.
"There is no question that Prince Harry was in any way seeking to insult his friend."
Khan's father Muhammad Yaqoob Khan Abbasi said he was "very, very hurt" by the "disgraceful insult", telling the Daily Mail newspaper from Pakistan: "That word he used is a hate word and should never be used against any Pakistani.
"Prince Harry should apologise to the Pakistani army and to the Pakistani government for this. I cannot accept his apology unless they first accept his apology."
News of the World said Harry made the "raghead" remark -- a racist term for Arabs -- while taking part in night manoeuvres in Cyprus.
The prince is filming when he spots a comrade with camouflage netting over his head and as he faces the camera, Harry says: "It's Dan the Man... you look like a raghead."
The royal spokesman said: "Prince Harry used the term 'raghead' to mean Taliban or Iraqi insurgent."
Harry is the youngest son of Prince Charles, the heir to the throne, and Diana, princess of Wales.
In another clip from the three-minute video, Harry pretends to make a mobile phone call to Queen Elizabeth.
He says: "Granny, I've got to go. Send my love to the corgis. And Grandpa... Bye. God save you. Yeah, that's great. See you, bye."