A British man detained in Bangladesh following a deadly cafe siege two years ago has been freed without charge.

Hasnat Karim was celebrating his daughter's 13th birthday at the Holey Artisan cafe with his family in the capital Dhaka in July 2016 when it was targeted by Islamist militants.

Twenty-two people, mostly foreigners, were killed over the course of the 12-hour siege, in what was the country's worst terrorist attack.

Eight other suspects have been charged.

Mr Karim, who is in his late forties and has dual British-Bangladeshi citizenship, was taken hostage when gunmen stormed the cafe.

Eyewitnesses at the time said he became a police suspect because he agreed to become a human shield during the siege.

Human rights group Amnesty International had campaigned against Mr Karim's continued detention.

The head of the police's counter terrorism and transnational crime unit Monirul Islam said on Monday that Mr Karim had been acquitted.

"During our two-year long investigation, we did not find any involvement [of Karim] in this attack directly or indirectly, so he was acquitted from this case," Mr Islam said.

The attack was claimed by the Islamic State group, although Bangladesh disputed this and said a local militant group was responsible.

Five militants inside the cafe were killed by police. Eight others have now been charged over their involvement, six of whom are in custody, according to Mr Islam.