The granting of bail does not mean that 69-year-old Musharraf, who is currently being held at his palatial farmhouse on the outskirts of Islamabad, will be freed as he faces two other cases -- detaining dozens of judges during the 2007 emergency and for the killing of Baloch nationalist leader Akbar Bugti in a 2006 military operation.
Judge Chaudhry Habib-ur-Rehman of the anti-terrorism court in Rawalpindi granted bail to Musharraf against two surety bonds of Rs 10 lakh each.
During the arguments, Musharraf's lawyer Salman Safdar said there was no solid evidence or witness against his client.
He said Musharraf had not been blamed for the 2007 suicide attack that killed Bhutto by the family of any of the victims.
Prosecutor Chaudhry Azhar of the Federal Investigation Agency opposed Musharraf's bail petition, saying the former President could flee Pakistan if he was freed from detention.
Bhutto was killed by a suicide bomber after addressing an election rally in Rawalpindi in December 2007. Musharraf has been accused of providing inadequate security to Bhutto.
Speculation is rife in Islamabad that Musharraf may be allowed to leave the country under a deal worked out by the powerful military.
