UK's Blair says EU exit would be "monumental error"

LONDON (Reuters) - Prime Minister David Cameron risks committing a monumental error that would threaten Britain's status as a world power if he allows rising anti-European Union sentiment to spiral into an EU exit, former leader Tony Blair said on Wednesday.

Britain's tortured relations with Europe have shot to the top of the political agenda in recent months, with rebellious anti-EU members of Cameron's ruling Conservatives pushing for a new role inside the 27-nation bloc - or even leaving altogether.

But while turning away from Europe may be a vote winner in the short-term, it would isolate Britain, undermine its international standing and damage its economy at a time of shifting global power, Blair said.

"This is the last moment conceivable that we should start talking about leaving... marginalizing ourselves at the very point at which we should be at the centre of things," Blair, who won three elections for the Labour Party, said in a speech at the Chatham House thinktank in London.

Cameron suffered a humiliating defeat in parliament on October 31 when rebels sided with Labour to demand EU spending cuts. He also faces a threat from the UK Independence Party, an anti-EU minority group.

The anti-EU camp sees Brussels as a meddling, wasteful superstate that threatens Britain's sovereignty. A poll on November 17 suggested 56 percent want to leave, against 30 percent who want to stay.

Urging politicians to do more to combat the anti-EU mood, Blair said Britain faced a "real and present danger by edging towards the exit".

"It would be a monumental error of statesmanship to turn our back on it and fall away from a crucial position of power and influence," Blair, wearing a navy suit and tie, told business leaders in the basement of an elegant 18th century townhouse.

'LITTLE ENGLANDERS'

Blair forged closer ties with Europe when he was prime minister from 1997 to 2007, although he did not take Britain into Europe's single currency. Current Labour leader Ed Miliband was accused of hypocrisy and opportunism for suspending his pro-EU beliefs to back the Conservative rebels in parliament.

Conceding that support for a British exit was not confined to "atavistic little Englanders", Blair said it would be wrong to pretend Britain would collapse if it left.

However, he said it was a "delusion" to say Britain could emulate non-EU states like Norway, which is far smaller and has huge oil and gas wealth, or Switzerland, which is "a unique case, politically and economically".

He laughed and brushed aside questions about him being a possible future European Union president.

Some of Britain's neighbors in its biggest trading partner are becoming exasperated with its lukewarm stance.

Italian Prime Minister Mario Monti told Italian TV earlier this week that it was time for Britain "to ask the fundamental question: Do you want to remain in the European Union or not?"

Cameron, trailing Labour in the polls, opposes an "in or out" referendum, talking instead of reworking Britain's EU role and putting that to voters.

Under pressure to clarify his stance on an issue that helped bring down the last two Conservative prime ministers, Cameron is due to give a major speech on Europe in the coming weeks.

(Editing by Guy Faulconbridge)

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Palestinians win more European support for limited statehood

GENEVA/RAMALLAH, West Bank (Reuters) - More European states joined France on Wednesday in backing a Palestinian bid for limited statehood, but Britain held back, saying it wanted an assurance that the Palestinians would not pursue Israel through the International Criminal Court.

Germany said it was opposing the diplomatic upgrade for the Palestinians at the United Nations, joining Israel and the United States which say the only genuine route to statehood is via a peace agreement made in direct talks with Israel.

Semi-statehood could allow Palestinian territories to access the court and other international bodies.

Palestinian President Mahmoud Abbas is leading the campaign and several European governments are eager to give him their support after an eight-day conflict this month between Israel and Islamists in the Gaza Strip, who are pledged to Israel's destruction and oppose his efforts towards negotiated peace.

With overwhelming support from the developing world, the Palestinians appear certain to earn approval in the 193-member U.N. General Assembly for a status upgrade to "observer state" on Thursday.

Switzerland, Denmark and Austria said they would vote for the upgrade. France gave its approval on Tuesday. Britain said it would not oppose the move but needed more assurances to give its support.

"The first is that the Palestinian Authority should indicate a clear commitment to return immediately to negotiations without preconditions," Foreign Seretary William Hague told parliament.

"The second assurance relates to membership of other specialized UN agencies and action in the International Criminal Court," he added.

The Swiss approval followed a visit to Berne by Palestinian President Mahmoud Abbas this month as the country hesitated between voting in favor of the resolution or abstaining.

Abbas had reiterated his commitment to relaunch the peace process immediately following the U.N. vote, the Swiss Foreign Ministry said.

Talks have been stalled for two years, mainly over the issue of Israeli settlements in the West Bank, which have expanded despite being deemed illegal by most of the world.

Germany said it would oppose the Palestinian bid. Berlin has close ties with Israel and has strongly backed the right of the Jewish state to hit back against rocket attacks from Gaza during the latest upsurge of violence in the region.

"Our goal in all this is to prevent further negative effects on the already difficult Middle East peace process," German foreign ministry spokesman Andreas Peschke said.

He reiterated Germany's support for a two-state solution as the final result of a "just and negotiated settlement".

TURNING POINT

In Ramallah in the West Bank, senior Palestine Liberation Organization official Hanan Ashrawi said the positive responses from other European states were encouraging and sent a message of hope to all Palestinians.

"This constitutes a historical turning point and opportunity for the world to rectify a grave historical injustice that the Palestinians have undergone since the creation of the state of Israel in 1948."

"Now the people of this land, with enormous solidarity, is telling the whole world not only that we exist, but we are on our land and we have a right to self-determination and statehood," she said.

Israel and the United States have mooted withholding aid and tax revenue that the Palestinian government in the West Bank needs to survive. Israeli Foreign Minister Avigdor Lieberman has also viewed options that include bringing down Abbas.

Israeli, British and U.S. diplomats had tried to persuade the Palestinians to drop their upgrade bid. When that foundered, they focused on trying to get the Palestinians to guarantee that they would forego complaining about Israel to the ICC.

The court prosecutes people for genocide, war crimes and other human rights violations.

The Palestinian U.N. observer, Riyad Mansour, said the Palestinians would not rush to sign up to the ICC if they win the U.N. status upgrade. But seeking action against Israel in the court would remain an option, he told a news conference at the United Nations on Tuesday.

Mansour said that if Israel continued to violate international law, particularly by building settlements in the West Bank - territory Israel captured in the 1967 Middle East War - then the Palestinians would consult with friends, including Europe, on what to do next.

The United States has suggested aid for the Palestinians - and possibly some funding for the United Nations - could also be at risk if the Palestinians win the U.N. upgrade. Israel has said it may cancel the Paris Protocol, an economic accord it maintains with the cash-strapped Palestinian Authority.

(Additional reporting by Mohammed Abbas in London, Mette Fraende in Copenhagen and Michael Shields in Vienna; Editing by Tom Pfeiffer)

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U.S., Pakistan ties fully repaired: Pakistan foreign minister

ISLAMABAD (Reuters) - Pakistan and the United States have restored full military and intelligence ties after relations hit a low point last year, and Islamabad will take further steps to support a nascent Afghan peace process, Pakistan's foreign minister said on Wednesday.

Full cooperation between Islamabad and Washington is critical to U.S. efforts to stabilize Afghanistan before most NATO combat troops withdraw by 2014.

"There was a fairly difficult patch and I think we've moved away from that into a positive trajectory," Pakistani Foreign Minister Hina Rabbani Khar told Reuters in an interview, referring to Pakistani-U.S. relations.

"We are coming closer to developing what could be common positions. We wish to see a responsible transition in Afghanistan."

Relations between the uneasy allies were severely strained by a series of incidents in 2011. The crisis in ties began when a CIA contractor shot dead two men he suspected of trying to rob him in the city of Lahore.

Months later, U.S. special forces killed Osama bin Laden in a raid and kept the Pakistan military in the dark, humiliating the country's most powerful institution.

Then a NATO air raid mistakenly killed 24 Pakistani soldiers on the Afghan border in November that year.

In response, Pakistan expelled U.S. military trainers and CIA agents and placed limits on the numbers of visas given to U.S. diplomatic personnel.

Pakistan, which relies heavily on American aid, also closed supply routes for trucks carrying supplies to U.S.-led NATO forces in Afghanistan.

Now, Khar said, relations were fully repaired, including military and intelligence contacts.

"We are having very useful, deep conversations with the U.S.," she said, as the two countries try to find common ground on Afghanistan ahead of the scheduled 2014 pullout.

"UNRELIABLE PARTNER"

Both the United States and Afghanistan have long regarded Pakistan as an unreliable partner in the drive to bring stability to Afghanistan, accusing Pakistan's intelligence agency of backing Afghan insurgent groups.

Pakistan denies that.

Pakistan recently released mid-level Afghan Taliban prisoners to help facilitate peace talks between the militant group and the Kabul government, the clearest sign it was committed to advancing Afghan reconciliation.

Khar said Islamabad was willing to take further steps but would not say whether that would include releasing senior Afghan Taliban figures, like the former second in command, Mullah Abdul Ghani Baradar.

"I think it is important that we have intensive engagement on what needs to be done," she said.

Afghan officials think Baradar may be one of the few commanders with the stature to bring elements of the Taliban into peace talks after more than a decade of war.

During a recent visit to Pakistan by members of the Afghan High Peace Council, Pakistan agreed to release some prisoners, although not Baradar, and to provide safe passage for those wishing to enter talks, Khar said.

Pakistan would also encourage Afghan insurgents to enter into direct talks with President Hamid Karzai's government. So far, there have been only contacts.

"For us in Pakistan today, the most important capital in the world is Kabul," said Khar, because instability there could spill over into Pakistan, and fuel its own Taliban insurgency.

She said the Afghan and Pakistan governments were discussing ways to strengthen military cooperation.

Currently, relations are strained. Afghanistan still suspects elements in Pakistan of supporting the Taliban, despite denials from Islamabad. The Pakistan military, pursing Pakistani insurgents, has also shelled villages across the border in Afghanistan, prompting protests.

CLOSER TIES WITH INDIA

In addition to improving ties with Afghanistan, Khar said Pakistan also wanted to pursue closer ties with arch-rival India.

The United States has long believed that Pakistan would focus more closely on helping it pacify Afghanistan if relations with India improved.

The nuclear-armed neighbours have fought three wars since their independence from British rule in 1947 and are at loggerheads over the status of the disputed territory of Kashmir.

"The Pakistani leadership has shown a great willingness to move forward, sometimes at the cost of losing some political capital, because sometimes improving ties with India might not be the most popular thing to do," said Khar.

Many Pakistani politicians blame India for Pakistan's insurgencies or spiraling crime rate, saying their wealthier, more populous neighbor wants to weaken Pakistan.

India, in turn, blames Pakistan for sending militants to infiltrate Kashmir over several decades and suspects Pakistan of shielding those behind a 2008 attack on Mumbai that left 166 people dead. India executed the only surviving perpetrator in their custody, a young Pakistani man, last week.

That should be an opportunity for the two countries to put the attack behind them and move forward, said Khar. Their warming relations recently resulted in an agreement easing trade and travel restrictions.

"We are clear that we want Pakistani-India relations to move forward swiftly," she said.

(Editing by Michael Georgy and Robert Birsel)

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Congo M23 rebels say withdrawing forces

GOMA, Democratic Republic of Congo (Reuters) - Rebels in eastern Democratic Republic of Congo have started withdrawing from towns captured since last week from government troops, following a deal brokered by Uganda, their military leader said on Wednesday.

Such a pull-out would mean the M23 rebel group was giving up gains from a lightning offensive carried out in the past week, but there was no indication they were ending their eight-month-old insurgency.

The rebellion, which U.N. experts say is backed by neighboring Rwanda, has raised the risk of all-out war in a borderlands region dogged by nearly two decades of conflict that has killed about 5 million people and is fuelled by competition over mineral resources.

"We're leaving Sake, we're leaving Masisi," Sultani Makenga told Reuters in rebel-held Goma, the provincial capital of North Kivu. "Goma will be later," he said, adding fighters would eventually pull back 20 km from the city.

"We want peace," Makenga said. "We're prepared for the return of government troops, they're going to come ... But if Kabila's troops harass the people we're prepared to come back in, we're just around the corner," he said.

Ugandan military chief Aronda Nyakayirima said on Tuesday after a meeting with Makenga that M23 had agreed to withdraw from Goma unconditionally. But M23's political leader Jean Marie Runiga initially cast doubt on the deal, saying the pull-out was contingent on a list of demands - including direct talks with President Joseph Kabila.

The mixed messages from Makenga and Runiga could be a sign of divisions within the movement, according to analyst Jason Stearns at independent think-tank the Rift Valley Institute.

"This is a military movement with a political wing created post facto ... it's undermined internal cohesion," he said.

Makenga told Reuters his decision to withdraw forces from Goma was made before the meeting with Uganda's army chief in Kampala, but Stearns believes M23 may be coming under external pressure given the storm of protest from regional powers caused by the rebel capture of Goma.

"The future of M23 depends on the diplomatic dance between donors, countries in the region and Kigali," Stearns said.

The rebels seized Goma on November20 after Congolese soldiers withdrew and U.N. peacekeepers gave up defending the city. U.N. experts say Rwanda, Congo's small but militarily powerful eastern neighbor, is giving orders to the rebels and supplying arms and recruits, a charge denied by Rwanda.

The Congolese army was skeptical about any M23 withdrawal.

"Let's see how things evolve, we'll see whether they're doing this in good faith or not ... Nothing has changed, we're still in our positions," Colonel Olivier Hamuli, spokesman for the FARDC army said.

About 100 people gathered in rain in Goma on Wednesday to protest against the possible return of government troops, marching to the U.N. offices to deliver a memo.

"When the government troops were here before we had no peace, now as we welcomed M23, we think they'll cause even more problems than before," protester Alain Safari said.

Makenga said rebel forces would withdraw to about 20 km of Goma, leaving a company of 100 soldiers at the airport, and allowing government troops to return to the city.

According to the agreement in Uganda, government troops would return to Goma on Thursday, followed by a visit on Friday by regional defense chiefs.

The conflict in eastern Congo - which has big reserves of gold, tin and coltan, an ore of rare metals used in making mobile phones - has displaced 140,000 civilians according to the United Nations.

(Reporting by Jonny Hogg; Writing by Bate Felix; Editing by Pravin Char)

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Car bombs kill 34 in pro-Assad Damascus suburb

BEIRUT (Reuters) - Two car bombs killed at least 34 people in a district of Damascus loyal to President Bashar al-Assad on Wednesday in the deadliest attack on the Syrian capital in months.

The explosions struck the eastern neighborhood of Jaramana, home to many of Syria's Druze minority as well as Christians who have fled violence elsewhere, ripping through shops and bringing debris crashing down on cars.

Once a bastion of security in Assad's 20-month campaign to crush an uprising against his rule, Damascus has been hit with increasing regularity as the rebels grow bolder.

State media said a bomb also detonated in the southern town of Bosra al-Sham, near Deraa, where the revolt began with peaceful street protests in March 2011. It also said eight "terrorists" were killed near Damascus while they tried to booby-trap a car with a bomb.

Authorities severely limit independent media in Syria and it was not immediately possible to verify reports. The government said 34 people were killed in Damascus but did not give a casualty count for the Bosra al-Sham bombing.

The attacks followed two weeks of military gains by rebels who have stormed and taken army bases across Syria, exposing Assad's loss of control in northern and eastern regions despite the devastating air power which he has used to bombard opposition strongholds.

A resident of Jaramana said that rebels had been repeatedly forbidden by local Druze elders to operate in the district, which borders the capital's center where government offices are located.

"Tension have risen between Druze elders and rebels and now there are 3 or 4 small explosions a week," she told Reuters on condition of anonymity.

Underlining the growing military muscle of the rebels, bolstered by weapons captured during raids on army facilities as well as supplies from abroad, fighters shot down a war plane in northern Syria on Wednesday using an anti-aircraft missile, the Syrian Observatory for Human Rights said.

Opposition groups subsequently posted a video clip on the Internet that showed a man in a green jumpsuit being carried through fields. He was bleeding heavily from his head and appeared unconscious. "This is the pilot that attacked the houses of civilians," said a voice off camera.

Another video showed doctors treating the limp body of apparently the same pilot, who activists said ejected from his MiG 23 fighter jet before it crashed near Darat Ezza, about 30 km (20 miles) from Aleppo.

The bloodshed came as Syria's new opposition coalition held its first full meeting on Wednesday to discuss forming a transitional government crucial to win effective Arab and Western support for the revolt against Assad.

"The objective is to name the prime minister for a transitional government, or at least have a list of candidates," said Suhair al-Atassi, one of the coalition's two vice-presidents.

The two-day meeting in Cairo will also select committees to manage aid and communications, a process that is becoming a power struggle between the Muslim Brotherhood and secular members.

Rivalries have also intensified between the opposition in exile and rebels on the ground in Syria, where the death toll has reached 40,000, including soldiers, civilians and rebels.

'TERRORIST' BOMBS

The Syrian state news agency, SANA, described Wednesday's blasts as "terrorist bombings", a label it reserves for attacks by mainly Sunni Muslim fighters battling to overthrow Assad, a member of Syria's Alawite minority linked to Shi'ite Islam.

Two smaller bombs also exploded in Jaramana at about the same time as the car bombs, around 7 a.m. (0500 GMT). In total at least 47 people were killed, the Syrian Observatory for Human Rights said, giving a higher toll than the government. Eighty three people were seriously wounded, the British-based Observatory said.

"Who benefits from this? Tell me who benefits from this? America, Israel, Qatar?" a man at the bomb site said to Syrian television, which broadcast footage of firefighters hosing down the blackened hulks of two vehicles and several cars crushed by debris from neighboring buildings.

Pools of blood could be seen on the road.

Most foreign powers have condemned Assad. Britain, France and Gulf countries have recognized the umbrella opposition group meeting in Cairo, the Syrian National Coalition, as the sole representative of the Syrian people.

But Assad has been able to rely on his allies, especially regional powerhouse Iran, which is believed to be bank-rolling him and supplying military support despite U.S. and European sanctions. Russia, Syria's main arms supplier, says it has only sent weapons already agreed to in previous deals.

International Syria mediator Lakhdar Brahimi is due to brief the 15-member council on Thursday and the U.N. General Assembly on Friday. There is diplomatic deadlock between Western powers, who broadly support the opposition and Assad's supporters Russia and China which have blocked Security Council action.

(Additional reporting by Oliver Holmes and Erika Solomon in Beirut, Khaled Yacoub Oweis in Cairo and John Irish in Paris)

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Egypt protests continue in crisis over Mursi powers

CAIRO (Reuters) - Hundreds of demonstrators were in Cairo's Tahrir Square for a sixth day on Wednesday to demand that President Mohamed Mursi rescind a decree they say gives him dictatorial powers, and two of Egypt's top courts stopped work in protest.

But in a move that one Muslim Brotherhood official said could help resolve the worst crisis of Mursi's five-month presidency, the assembly drawing up a new constitution said it would complete work on a final draft on Wednesday.

The official said the final draft could go to a popular referendum by mid-December. If approved it would cancel the constitutional declaration that extended Mursi's powers and sparked street protests that drew tens of thousands on Tuesday. Brotherhood and other Islamists have called for a rally backing the president on Saturday.

"We will start now and finish today, God willing," Hossam el-Gheriyani, the constituent assembly speaker, said at the start of a meeting to finalize drafting the constitution.

Three assembly members said a vote on the draft by the assembly was planned for Thursday.

Many liberals and other opponents of Mursi have walked out of the constituent assembly, which is dominated by Islamists, saying their voices are not being heard.

Once drafted, the constitution will go to Mursi for approval, and he must then put it to a popular referendum within 15 days, which could mean the plebiscite would be held by mid-December.

The move immediately drew scorn from leading Egyptian opposition figure Amr Moussa, a former Arab League chief.

"This is nonsensical and one of the steps that shouldn't be taken, given the background of anger and resentment to the current constitutional assembly," he told Reuters.

Adding to the tension, Egypt's Cassation and Appeals courts said they would suspend their work until the constitutional court rules on the decree.

The judiciary, largely unreformed since the popular uprising that unseated Mursi's autocratic predecessor Hosni Mubarak, was seen as a major target in the decree issued last Thursday, which extended his powers and put his decisions temporarily beyond legal challenge. The decree also protected the constituent assembly from judicial oversight, fending off court cases that call for it to be dissolved.

DEPTH OF ANGER

"The president wants to create a new dictatorship," said 38-year-old Mohamed Sayyed Ahmed in Tahrir. He has not had a job for two years and is one of many in the square who are as angry over economic hardship as they are about Mursi's actions.

"We want the scrapping of the constitutional declaration and the constituent assembly, so a new one is created representing all the people and not just one section," he said.

Showing the depth of distrust of Mursi in parts of the judiciary, a spokesman for the Supreme Constitutional Court, which earlier this year declared void the Islamist-led parliament, said it felt under attack by the president.

In a speech on Friday, Mursi praised the judiciary as a whole but referred to corrupt elements he aimed to weed out.

"The really sad thing that has pained the members of this court is when the president of the republic joined, in a painful surprise, the campaign of continuous attack on the Constitutional Court," said the spokesman Maher Samy.

Senior judges have been negotiating with Mursi about how to restrict his new powers.

Mursi's administration insists that his actions were aimed at breaking a political logjam to push Egypt more swiftly towards democracy, an assertion his opponents dismiss.

The West worries about turbulence in a nation that has a peace treaty with Israel and is now ruled by Islamists they long kept at arms length. The United States, a big donor to Egypt's military, has called for "peaceful democratic dialogue".

Two people have been killed in violence since the decree, while low-level clashes between protesters and police have gone on for days near Tahrir. Violence has flared in other cities.

Trying to ease tensions with judges, Mursi said elements of his decree giving his decisions immunity applied only to matters of "sovereign" importance, a compromise suggested by the judges.

That should limit it to issues such as declaring war, but experts said there was much room for interpretation. The judges themselves are divided, and the broader judiciary has yet to back the compromise. Some have gone on strike over the decree.

A constitution must be in place before a new parliament can be elected, and until that time Mursi holds both executive and legislative powers. An election could take place in early 2013.

One presidential source said Mursi wanted to re-make the Supreme Constitutional Court after it declared the parliament void, which led to its dissolution by the then ruling military.

Both Islamists and their opponents broadly agree that the judiciary needs reform, but Mursi's rivals oppose his methods.

(Additional reporting by Tom Perry and Marwa Awad; Writing by Edmund Blair; Editing by Will Waterman)

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Polish ruling on kosher meat angers Jews

WARSAW (Reuters) - Jewish groups said on Wednesday a Polish court ruling on methods used to slaughter livestock could halt the production of kosher meat, threatening their religious freedom in a country where Nazi Germany massacred millions of Jews in World War Two.

Poland's Constitutional court this week reinforced a law that states livestock has to be stunned before slaughter, ruling out the practice stipulated by the Jewish faith of slaughtering the animal by slitting its throat while it is still conscious.

The court took up the case after lobbying from animal rights groups who said the kosher method was cruel. But the case has inflamed religious sensitivities in Poland against the backdrop of the Holocaust when Poland was under German occupation.

"While it may not be their intention, those who seek to proscribe Jewish traditions in general and shechitah (kosher slaughter) in particular are reminding the Jewish community of far darker times," Aryeh Goldberg of the Rabbinical Centre of Europe said in a statement.

"We call on the Polish government to find a legal caveat which will ensure the continuation of shechitah, which is such an important part of Jewish life ... all over the world and particularly in Poland," Goldberg said.

The European Jewish Association called the ruling "devastating to Jewish welfare and freedom of religion", and said it was sending a letter of protest to the Polish president.

Animal rights activists have challenged religious slaughter customs in France and the Netherlands, mostly in terms of halal slaughter by Muslims, which like kosher slaughter requires animals to be conscious when killed.

The Polish dispute has echoes of a case in neighboring Germany this year. There, a court ruling outlawing circumcision of young boys on medical grounds raised an outcry from Jews and Muslims, who said it curtailed their religious freedom. The German ruling is to be overturned by new legislation.

Poland was home to Europe's largest Jewish community before the outbreak of war in 1939, but the Holocaust all but wiped it out. Nazi concentration camps including Auschwitz and Treblinka were located on Polish soil.

The Jewish community in Poland now numbers about 8,000, according to official figures, though community leaders say the real number is higher. Poland's population stands at 37 million.

MEAT EXPORTS

Small quantities of kosher or halal meat are produced for Poland's Jewish and Muslim communities. In addition, Polish slaughterhouses have begun exporting to countries such as Turkey and Israel, and so have increased the quantities of livestock killed in accordance with religious rules.

Jewish groups say the kosher method of slaughtering meat does not cause unnecessary suffering to the animal.

Poland has for years had a law requiring that vertebrate animals are stunned before they are killed in abattoirs. The agriculture ministry issued a decree waiving this requirement in cases where it clashed with religious rules.

The constitutional court, in its ruling this week, which cannot be appealed, said that the ministry's waiver was unlawful and would cease to apply from the beginning of next year.

European Union legislation does allow for slaughter according to Jewish and Muslim rites, but there is uncertainty over whether, in this case, the Polish or EU legislation takes precedence.

Piotr Kadlcik, head of the Union of Jewish Communities of Poland, said that besides the substance of the court's ruling, he was troubled by the tone of the debate surrounding it.

"The outrageous atmosphere in the Polish media surrounding shechitah reminds me precisely of the similar situation in Poland and Germany in the 1920s and 1930s," he told Reuters.

"The style of these media reports was really similar: the (allegations of) disgusting practices and big business for a certain group of people. The tribunal may have felt obliged to react more promptly given this kind of hue and cry."

(Reporting by Marcin Goettig; Editing by Mark Heinrich)

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Russian mafia whistleblower, 44, found dead in UK

WEYBRIDGE, England/LONDON (Reuters) - A Russian businessman helping Swiss prosecutors uncover a powerful fraud syndicate has died in unexplained circumstances near his mansion in Britain, in a chilling twist to a Russian mafia scandal that has strained Moscow's ties with the West.

Alexander Perepilichny, 44, sought refuge in Britain three years ago and had been helping a Swiss investigation into a Russian money-laundering scheme by providing evidence against corrupt officials, his colleagues and media reports said.

He has also provided evidence against those linked to the 2009 death of anti-corruption lawyer Sergei Magnitsky, a case that caused an international outcry and prompted the United States to push for a bill cracking down on Russian corruption.

Perepilichny, a Russian citizen, collapsed and died not far from his home on an upmarket, heavily protected estate in the county of Surrey, south of London, on November 10.

He is now the fourth person linked to the Magnitsky case to have died in strange circumstances.

"It is being treated as unexplained," a police spokeswoman said. "A post-mortem examination was carried out which was inconclusive. So further tests are now being carried out."

Locals at the estate - dubbed as Britain's Beverly Hills and ringed by neatly trimmed golf courses and security check points - told Reuters that Perepilichny's body, clad in running gear, was found after dark at the top of a hill.

A shaky mobile phone video clip shot by Liam Walsh, a 24-year-old local chef, showed a motionless body of what he said was Perepilichny stretched out on the side of a deserted lane lit by the light of a lone lamp-post.

"He wasn't breathing. We had to get him on the back and start doing CPR (first aid). He was probably dead for a while," Walsh told Reuters as unmarked security cars patrolled the immaculately maintained estate.

Far beyond Russia's borders, Magnitsky's death has become a symbol of corruption in Russia and the abuse of those who challenge the authorities there.

This month the U.S. House of Representatives voted overwhelmingly to "name and shame" Russian rights violators as part of a broader trade bill, brushing off warnings from Moscow that the move would damage relations.

William Browder, a former employer of Magnitsky and a prominent London-based investor, said Perepilichny had come forward in 2010 with evidence involving the Magnitsky case that subsequently helped Swiss prosecutors open their investigation.

"Alexander Perepilichny approached us in 2010 as a whistleblower with evidence about the complicity of a number of Russian government officials in the theft of $230 million which Sergei Magnitsky had uncovered," said Browder, founder of Hermitage Capital Management.

"He provided us with copies of many of the original bank documents. In January 2011, Hermitage filed an application to the Swiss authorities seeking an investigation. It was announced in March that the Swiss prosecutor's office opened an investigation and froze the assets in a number of accounts."

Browder, whose grandfather was the general secretary of the American Communist Party, was one of the biggest Western investors in Russia but was barred from Russia in late 2005 and most of his staff left the country as Hermitage found itself coming under increasing official pressure.

Magnitsky was jailed in 2008 on suspicion of tax evasion and fraud, charges that colleagues say were fabricated by police investigators he had accused of stealing $230 million from the state through fraudulent tax refunds. The Kremlin's own human rights council has said Magnitsky was probably beaten to death.

News of Perepilichny's death initially appeared on Wednesday in a report in Britain's Independent newspaper, which is backed by Alexander Lebedev, a Russian billionaire who has spoken out publicly against the Kremlin.

British media said Perepilichny appeared to be in good health before he collapsed in the evening outside St George's Hill, one of Britain's most exclusive estates, where he was renting a house for 12,500 pounds ($20,000) a month.

St George's Hill is home to many big names in the financial and celebrity circles, its long list of one-time tenants including Elton John and Ringo Starr.

MAFIA STATE

Leaked secret diplomatic cables from the U.S. embassy in Moscow once described Russia as a "virtual mafia state", and London has long been the chosen destination for Russians seeking refuge from trouble at home.

But concerns have been growing in recent years that Britain might be turning into a playground for Russian mobsters as gangland violence seems to be spilling over Russian borders.

In April, a former Russian banker was shot near London's Canary Wharf financial district, sending a chill through the immigrant community. In 2006, former Russian spy Alexander Litvinenko died after drinking tea poisoned with polonium-210.

Asked about Perepilichny's case, Swiss prosecutors said it started its criminal investigation in March 2011 following a complaint made by London law firm Brown Rudnick filed on behalf of Hermitage Capital Management.

"Concerning the death of Mr Perepilichny and its consequences on the criminal proceedings, we'd like to stress that our strength resides in our ability to minimize the influence of such a regretful event on our investigation," the Swiss Office of the Attorney General said in a statement.

"A good cooperation with other judicial authorities is also essential to carry on our investigation efficiently."

Perepilichny was also a witness against Russia's notorious Klyuyev Group, a murky network of officials and underworld figures implicated in tax fraud who used European bank accounts to buy luxury property in Dubai and Montenegro, The Independent reported.

"Perepilichny was the guy who brought all the evidence they needed to open the investigation," a source told The Independent. "He brought with him records of shell companies, Credit Suisse accounts, property transactions. The whole lot."

(Additional reporting by Martin de Sa'Pinto in Switzerland; Writing by Maria Golovnina)

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Iran "will press on with enrichment:" nuclear chief

DUBAI (Reuters) - Iran will go on refining uranium "with intensity" and the number of enrichment centrifuges it has operating will rise substantially in the current year, the country's nuclear energy chief was quoted as saying on Wednesday.

The comments by Fereydoun Abbasi-Davani, head of Iran's Atomic Energy Organisation, signaled continued defiance in the face of international demands that Tehran halt enrichment to the higher 20 percent fissile purity level, close down its Fordow enrichment plant, and ship out its stockpile of the material.

But he also said Iran would continue and possibly raise its output of reactor fuel using 20 percent enriched uranium - which suggests that less of it might be available for use in what the West suspects is an attempt to develop atom bombs.

Iran says it needs 20 percent refined uranium - as opposed to the lower-grade enrichment to 3.5 percent level needed for nuclear power plants - to turn into fuel for a medical research reactor in Tehran.

It says its nuclear program has purely peaceful purposes.

Diplomacy between Iran and the world powers - the United States, China, Russia, France, Germany, and Britain - has been deadlocked since a June meeting that ended without breakthrough.

Both sides now say they want to resume talks soon, after this month's re-election of U.S. President Barack Obama.

Diplomats expect a new meeting in Istanbul later this year or in January. One diplomatic source said the powers would propose the first half of December but that the following month was more likely.

"We all recognize that there is a window of opportunity and that window is not very big and it is not going to be open for very long," another diplomat said. "The hope is that there will be a meeting (between the powers and Iran) in the near future."

Iran has faced a tightening of Western trade sanctions in the past two years, with the United States and its allies hoping the measures will force Iran to curb its nuclear program.

STOCKPILE

"Despite the sanctions, most likely this year we will have a substantial growth in centrifuge machines and we will continue enrichment with intensity," state television quoted Abbasi-Davani as saying. The Iranian calendar year ends on March 20.

But Abbasi-Davani did not say whether Iran would increase the work that most worries the West, the higher-grade enrichment of uranium to 20 percent purity.

Abbasi-Davani said Iran was continuing its production of fuel to power the Tehran reactor - which uses fuel converted from 20 percent enriched uranium - and could possibly increase its production from two "complexes" of fuel per month to three, according to state news agency IRNA.

That could help ease concerns over a recent increase in Iran's higher-grade uranium stockpile which Western countries fear could be diverted for use in a possible weapons program.

A U.N. nuclear watchdog report issued this month showed that Iran in late September suddenly stopped converting 20 percent enriched uranium into oxide powder used at the Tehran reactor.

Because Iran's enrichment work at the same time continued unabated, the halt meant that its stockpile of the higher-grade uranium rose by nearly 50 percent to 135 kg in November compared with the level in the previous quarterly report in August.

Iran started producing 20 percent-enriched uranium at the Fordow site, buried deep inside a mountain, in 2011 and has been operating 700 centrifuges there since January. A U.N. report this month said more centrifuges may soon be launched.

Abbasi-Davani said the Arak research reactor, which Western experts say could potentially offer Iran a second route to material for a nuclear bomb, faced "no problems" and was progressing towards a launch as normal, the website of Iranian state television (IRIB) reported.

This month's U.N. report showed that Iran has postponed until 2014 the planned start-up of the Arak complex, which analysts say could yield plutonium for nuclear arms if the spent fuel is reprocessed.

(Additional reporting by Fredrik Dahl in Vienna and Justyna Pawlak in Brussels; Editing by Alison Williams)

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Colombia leaves pact recognizing U.N. court rulings

BOGOTA (Reuters) - Colombia has withdrawn from a treaty that binds it to the U.N. International Court of Justice in anger at a ruling that shifts some of its resource-rich waters to Nicaragua, President Juan Manuel Santos said on Wednesday.

The Hague-based court ruled last week that a cluster of disputed islands in the western Caribbean belonged to Colombia and not to Nicaragua, but drew a demarcation line in favor of Managua in the nearby waters.

The decision, which reduced the expanse of sea belonging to Colombia, set off a scramble in Bogota to see how to overturn the verdict and avoid diplomatic conflict with Nicaragua's President Daniel Ortega, who said he had sent ships to the area.

Meanwhile, Santos ordered the Colombian navy to remain in the waters granted to Managua.

"The highest national interests demand that territorial and maritime limits are set by agreements as has always been the case in Colombian judicial tradition, and not via rulings uttered by the International Court of Justice," Santos said.

"This is the moment for national unity. This is the moment that the country has to unite."

Colombian Foreign Minister Maria Angela Holguin was to provide further details to reporters later on Wednesday.

The 1948 treaty, known as the Bogota Pact, recognizes ICJ rulings to find peaceful solutions to signatories' conflicts.

Leaving the pact would mean Colombia is not obliged to heed the court's ruling on any potential bids by Nicaragua to seek additional territory, the government has said.

But its withdrawal would not have a retroactive effect, and it would be obliged to comply with last week's ruling.

Ortega has said he expects Colombia to recognize the court decision, which is binding, but experts have said Colombia may reject it and seek to negotiate a new border pact.

Santos has not yet said whether he will accept the latest ICJ decision. He rejected the changes to the border, saying the ruling had "omissions, mistakes, excesses, inconsistencies, that we can not accept."

Nicaragua's continental shelf and economic exclusion zone in the Caribbean was increased by the court ruling, giving it access to potential underwater oil and gas deposits as well as fishing rights.

In 2007, the court ruled in a long-running dispute between the two countries that three large islands of San Andres, Providencia and Santa Catalina belonged to Colombia.

(Additional reporting by Luis Jaime Acosta in Bogota; Editing by Bill Trott)

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India executes last surviving Mumbai attacker, sparks celebrations

MUMBAI, India/FARIDKOT, Pakistan (Reuters) - India secretly hanged the lone survivor of the Pakistan-based militant squad responsible for a rampage through Mumbai that killed 166 people, sparking celebrations days before the fourth anniversary of the assault on the financial capital.

Pakistan national Mohammad Ajmal Kasab was the enduring image of the bloody assault, which traumatized India and raised fears of copycat attacks on foreign cities. Pictures of the boyish gunman wearing a black T-shirt and toting an AK-47 rifle as he strode through Mumbai's train station were published around the world.

Kasab was executed on Wednesday morning amid great secrecy, underscoring the political sensitivity of the November 26, 2008, massacre, which still casts a pall over relations between nuclear-armed rivals Pakistan and India.

"All the police officers and personnel who lost their life in the battle against the terrorists have today been served justice," Home Minister Sushil Kumar Shinde said after Kasab was hanged in a jail in Pune, southeast of Mumbai.

Kasab was charged with 86 offences, including murder and waging war against the Indian state, in a charge-sheet running to more than 11,000 pages.

It was the first time a capital sentence had been carried out in India since 2004. There was celebration on the streets of Mumbai and other cities as news of the execution spread, but militant groups in Pakistan reacted angrily, as did residents of his home village of Faridkot.

People set off fireworks and handed out sweets in Indian cities. Some held up photos of Kasab with a rope noose superimposed over his head.

Attack survivor Vishnu Zende, who was working at Mumbai's train station where nearly 60 people were killed, said the execution brought it all back.

"When I heard the news of Kasab's execution today, I remembered those horrifying moments of the attack," Zende said.

"My eyes were filled with tears."

An effigy of Kasab was hung by the neck from the entrance gate of the station by a right-wing local party. A crowd of about 30 shouted "Pakistan murdabad" (death to Pakistan) as they beat the effigy, which had shoes hung around its shoulders.

In Pakistan, a senior commander of the Lashkar-e-Taiba (LeT) militant group, which India blames for the assault on Mumbai, called Kasab a hero and said he would inspire more attacks.

"To die like Kasab is the dream of every fighter," the commander told Reuters by telephone from an undisclosed location.

The Pakistan Taliban said they were shocked by the hanging.

"There is no doubt that it's very shocking news and a big loss that a Muslim has been hanged on Indian soil," Taliban spokesman Ihsanullah Ihsan told Reuters.

TICKET TO HEAVEN

Kasab was buried inside the prison where he was hanged, officials said. He was quiet and seemed nervous before the execution, a prison guard told the NDTV network. He prayed and asked if his family had been informed, which they had.

India said it would hand over the body to Pakistan if asked. Talking to Reuters from Faridkot, Kasab's aunt said she was proud of him and wanted his body back. A schoolmate remembered a boisterous child who loved karate "but never harmed anyone". Villagers threw stones and slapped around journalists who went to the village in the province of Punjab.

This year, Saudi Arabia extradited an Indian-born militant accused of being a key plotter in the Mumbai attacks. Police say Sayeed Zabiuddin Ansari, also known as Abu Jindal, helped coordinate the attack from a "control room" in the Pakistani city of Karachi and also helped to train the gunmen.

In a video of his interrogation by Indian police, Kasab said his trainers and handlers had assured him prior to the attack that his killing spree was a sure ticket to rewards in heaven.

In August, India's Supreme Court upheld Kasab's 2010 death sentence over the attacks. President Pranab Mukherjee rejected his plea for clemency on November 5, although this was not made public until Tuesday night.

The timing of the execution, shortly before a series of state elections, may be beneficial for the government, which opposition leaders accuse of being soft on national security.

"FOOT SOLDIER"

Ten militants arrived on the Mumbai shoreline in a dinghy on November 26, 2008, before splitting into four groups and embarking on a killing spree. They held off elite commandos for up to 60 hours in two luxury hotels and a Jewish centre in the city.

India says Islamabad is failing to act against those behind the raids, including LeT founder Hafiz Saeed, who has a $10 million U.S. bounty on his head. Pakistan admits the attacks were planned on its soil, but denies official involvement.

It says seven suspects are being prosecuted for their role.

"Kasab was a foot soldier, the generals are in Islamabad, in Pakistan, and full justice will be done when they are brought to justice," Gopalapuram Parthasarathy, a former ambassador to Pakistan, told Reuters.

Improving relations with Pakistan is a keystone of Prime Minister Manmohan Singh's foreign policy. Singh, who was born in present-day Pakistan when it was still part of British India, has repeatedly postponed visiting the country because of lack of progress on convicting the Mumbai suspects.

However, India and Pakistan's relations have gradually improved since the attacks, with progress made on trade and economic ties.

Possibly because of the planned execution, India on Tuesday asked Pakistan to postpone a visit this week by Interior Minister Rehman Malik, saying the dates were "not suitable for us". Malik was due to put the final seal on a deal to ease visa restriction for travelers.

Kasab's execution happened very quickly for India's usually glacial justice system. Three people convicted of the assassination of former Prime Minister Rajiv Gandhi are still on death row, 21 years after he was killed by a suicide bomb.

In Pakistan, many said the hanging happened quickly only because of his nationality. People questioned whether Kasab was really guilty, despite the video evidence.

Pakistan was informed beforehand about Kasab's execution, said a Pakistani foreign ministry official who asked not to be identified. "If all judicial procedures were followed, then the decision is acceptable," the official said.

(Writing by Frank Jack Daniel and Ross Colvin; Additional reporting by Annie Banerji, Arup Roychoudhury, Diksha Madhok, and Suchitra Mohanty in NEW DELHI, Swati Bhat, Henry Foy and Aradhana Aravindan in MUMBAI, Imtiaz Shah in KARACHI and Michael Georgy and Mehreen Zahra-Malik; in ISLAMABAD.; Editing by Nick Macfie)

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Goma rebels say will "liberate" all Congo

SAKE/GOMA, Democratic Republic of Congo (Reuters) - Rebel forces in eastern Congo vowed on Wednesday to "liberate" all of the vast central African country as they began seizing towns near the Rwandan border and spoke of a 1,000-mile march to the capital Kinshasa.

The M23 rebels, widely believed to be backed by Rwanda, captured the eastern city of Goma on Tuesday, a provincial capital home to a million people; United Nations peacekeepers simply looked on, after Congolese troops had quit the town.

"The journey to liberate Congo has started now," Vianney Kazarama, spokesman for the rebel group, told a crowd of more than 1,000 at a stadium in Goma. "We're going to move on to Bukavu, and then to Kinshasa. Are you ready to join us?

Hours later, a rebel unit took control of Sake, a strategic town near Goma on the road running the length of Lake Kivu to Bukavu, 100 km (60 miles) away at the lake's southern end. In the 1990s, the current president's father burst out of the same area at the head of a rebel force to overthrow Mobutu Sese Seko.

A Reuters correspondent in Sake saw rebels in control of the town and no sign of fighting. On the outskirts of Goma, he saw buildings which had been shelled on Tuesday in heavy fighting as the troops of the Kinshasa government's FARDC army withdrew from the town, under fire from M23. The bodies of four soldiers lay in the road there, near an abandoned tank, and another body in civilian clothing lay in undergrowth among the houses.

The government in Kinshasa issued a statement on Wednesday admitting it had lost the battle but pledging to win the war: "Victory will be ours. That is what the Congolese want."

RWANDAN ROLE

The rebels accuse President Joseph Kabila of failing to grant them posts in the army in line with a peace deal that ended a previous revolt in 2009. The current rebellion also reflects local ethnic tensions, intertwined with Rwanda's desire for influence over a neighboring region rich in minerals.

Rwanda previously backed the insurgency that swept Kabila's father, Laurent, to power in 1996 after a march across Congo to oust Mobutu, veteran dictator of a country then known as Zaire.

The new fighting has aggravated tensions between the Democratic Republic of Congo and Rwanda, which the Congolese government says is orchestrating the insurgency as a means of grabbing resources, which include diamonds, gold and coltan, an ore of rare metals used in electronics and high-tech materials.

U.N. experts have backed Congo's accusations - implicating Rwanda's defense minister. The government in Kigali denies the charges and says Kinshasa and world powers have failed to address the root causes of years of conflict in the region.

Kabila and Rwandan President Paul Kagame met on Wednesday in the Ugandan capital Kampala after holding three-way talks with Ugandan President Yoweri Museveni late on Tuesday. The Ugandan government said foreign ministers from the Great Lakes region had urged the African Union to deploy troops to halt the rebels.

But there are signs of trouble for Kabila already spreading in the resource-rich country the size of western Europe.

A Reuters reporter saw hundreds of young men with sticks sack the headquarters of Kabila's PPRD party in Bukavu, in protest at the Congolese government's failure to defend Goma.

Goma itself was quiet on Wednesday but at the rebel rally in the stadium, dozens of members of the security forces who had not fled the city appeared to have joined the insurgents.

"Its a problem of governance; there no food, there's no money," Rashidi Benshulungu, a captain in military intelligence who had changed sides, told Reuters. "I'm not a politician, that's a problem for Kabila. But we're following the ARC," he added, using an acronym used by the M23's combat force.

AGGRAVATED TENSIONS

While regional mediator Uganda brokered talks between Congo and Rwanda, whose armies have repeatedly clashed during nearly two decades of on-off conflict around the Great Lakes, the U.N. Security Council condemned the rebels.

It approved a French resolution that "demands the immediate withdrawal of the M23 from Goma, the cessation of any further advances by the M23 and that its members immediately and permanently disband and lay down their arms".

The Council expressed "deep concern at reports indicating that external support continues to be provided to the M23, including through troop reinforcement, tactical advice and the supply of equipment, causing a significant increase of the military abilities of the M23". It "demands that any and all outside support to the M23 cease immediately".

The French government also expressed frustration with the U.N. peacekeepers, from India, South Africa and Uruguay, who gave up defending the city after Congo's army retreated. Paris called it "absurd" that the U.N. force did not protect Goma.

But a senior U.N. official, who spoke on condition of anonymity, said the withdrawal of Congolese civilian officials and troops had left a void it could not fill alone.

"We're not the army of any country, let alone the Congolese army, and it's not for us to take positions by ourselves to stop a rebel attack, or the movement of rebels," the official said.

While conflict has simmered almost constantly in Congo's east in recent years, this is the first time Goma has fallen to rebels since foreign occupying armies officially pulled out under peace deals at the end of the most recent 1998-2003 war.

Aid agencies have estimated that 5 million people have died from fighting and conflict-related disease since that war began. Tens of thousands of people have already fled days of fighting between the rebels and the U.N.-backed Congolese soldiers.

New York-based Human Rights Watch said at least 11 civilians had been killed in the latest fighting for Goma.

SAKE FALLS

In Sake, 25 km (15 miles) west of Goma, local people said Congolese troops had briefly regrouped there before pulling out again before the rebels drove in on Wednesday.

"The ARC arrived an hour ago. Luckily there was no force used. Now they're pretty much everywhere," said Christian Bigebika, executive secretary of an association of local rights groups. "The army had already left."

Congo's government on Tuesday rejected the idea of talks with rebels. But Rwanda's foreign minister said the fall of Goma had shown there was no military solution to the crisis, so Kinshasa had to seek the path of dialogue.

As a result, Kabila faces the tricky choice between dialogue with the rebels, which will be politically unpopular, and trying to rally his scattered forces in North Kivu province.

He had been praised for securing peace deals that ended the last war but his re-election late last year provoked demonstrations by many frustrated with the slow pace of change.

Expectations in Goma are low: "You know, we don't have a choice. We've come here to welcome them," said Blaise Ciza, a Goma resident who attended the rebel rally at the stadium.

"But one thing that's impressed us is they didn't kill lots of people when they took the town. Last night we were scared but it remained calm. We congratulate them for that."

(Additional reporting by Elias Biryabarema in Kampala, Michelle Nichols at the United Nations and Crispin Kyala in Bukavu; Writing by David Lewis; Editing by Alastair Macdonald)

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Archbishop: Church of England is blind, losing credibility

LONDON (Reuters) - The Archbishop of Canterbury accused his Church of England of being willfully blind to the attitudes of modern British society on Wednesday after it voted 'no' to women bishops, a triumph for its traditionalist minority.

After more than 10 years of divisive debate, the General Synod, the Church legislature, failed to pass the measure on Tuesday evening by just six votes despite the fact that 42 of the Church's 44 dioceses had earlier approved it.

Women have served as priests in the Church for over 20 years, but Tuesday's vote effectively denied them access to the upper echelons of the hierarchy for several more years to come.

This is at odds with the much of British society, where gender equality is seen as a given right. Newspaper commentaries on Wednesday portrayed the Church as seriously out of step and in danger of becoming irrelevant.

"It seems as if we are willfully blind to some of the trends and priorities of ... wider society," Archbishop Rowan Williams said in a speech to the Synod still meeting after the vote.

"We have some explaining to do. We have as a result of yesterday undoubtedly lost a measure of credibility in our society."

"CHURCH IS NOT DEAD"

The structure of the Synod means the proposed reforms must now be postponed for at least another five years, extending a debate that has pitted reformists against conservatives.

The Church's second most senior cleric denied accusations it was facing an existential crisis after the vote.

"This morning people have been saying 'the Church has committed suicide, the Church is dead,'" Archbishop of York John Sentamu told BBC Radio.

"Well, dead people don't converse. We have been conversing, we have not committed suicide at all, we are very much living," he said.

There are already female Anglican bishops in Australia, New Zealand, Canada and the United States, but progress has been hobbled in England by an inability to ways to accommodate conservatives who say a male-only clergy is the will of God.

The Church has already voted for women bishops in theory, but before they can be ordained, it needs to agree a provision to allow alternative male bishops to minister to any parishes that object to a woman heading their diocese.

The Church of England, mother church for the world's 80 million Anglicans, must focus on the issue or risk alienating wider society, Williams said. Polls show there is substantial support for women bishops among Anglican believers in Britain.

"Every day in which we fail to resolve this to our satisfaction, is a day when our credibility in the public eye is likely to diminish ... we can't afford to hang about," he said.

DISINTEREST THREATENS CHURCH

Tony Baldry, a Conservative deputy who speaks for the Church in Parliament, told Reuters the institution now risked becoming irrelevant to many Britons.

"The greatest risk now for the Church of England is just disinterest - there is risk that it will simply look like some other religious sect," he said.

"There is no white rabbit that can be instantly pulled out of the hat, either in Parliament or the General Synod, that is going to resolve this issue, which makes this decision all the more tragic."

By contrast, the conservative group Reform welcomed the outcome. "We thank God that the Church of England has avoided making a big mistake which would have led to real division and a less inclusive Church," it said in a statement.

"It has avoided putting significant minorities who, as faithful Anglicans seek to follow the Bible's teaching, into an impossible position."

(Reporting By Alessandra Prentice, editing by Tom Heneghan)

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Bomb kills 3 soldiers, 2 civilians in Pakistan

QUETTA, Pakistan (Reuters) - A bomb blast killed three soldiers and two civilians in the Pakistani city of Quetta on Wednesday, security officials said.

The bomb, attached to a motorcycle, exploded near a security vehicle escorting school children, they said. Sixteen people were wounded. A Reuters reporter saw the corpses of three soldiers under the vehicle as it burned.

There was no immediate claim of responsibility for the attack in Baluchistan, Pakistan's biggest but poorest province which borders Afghanistan and Iran, and where several militant groups are active.

Ethnic Baluch separatists are waging an insurgency, demanding more autonomy and control over natural resources. Pro-Taliban militants also operate in the area and Sunni Muslim militants regularly carry out attacks on Baluchistan's Shi'ite Muslim minority.

In a separate attack, suspected militants shot dead four policemen in the northwestern town of Bannu, a police official said. Pakistan's Taliban movement claimed responsibility.

(Reporting by Saleem Shahid; Writing by Michael Georgy; Editing by Mark Heinrich)

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Mali Islamists threaten interests outside Africa: UK

ABUJA (Reuters) - An Islamist rebellion in northern Mali could become a springboard for jihadists to threaten interests beyond West Africa, Britain's new envoy to the Sahel region said on Wednesday.

Military experts from Africa, the United Nations and Europe have drafted plans to retake control of northern Mali, which fell to rebels in March after a coup in the capital Bamako created a power vacuum.

"This deep insecurity ... we have to recognize that, unless it is checked and it is not met, then it will have the potential for export," said Stephen O'Brien, Britain's first special envoy to the Sahel, a 600-mile (1,000-km) strip of semi-Arid land just south of the Sahara.

In an interview with Reuters while on a visit to the Nigerian capital Abuja, O'Brien said the Mali crisis was "a universal threat" with "the capability of threatening interests outside the ... region."

African leaders will this month seek a U.N. mandate to send a mainly West African force of some 4,000 to Mali to rebuild its army and then back military operations to retake swathes of the Sahara desert from rebels.

Nigeria, whose home grown Islamist movement Boko Haram has made links with Al Qaeda's north African wing (AQIM) in Mali, would commit 600 troops to any intervention, the country's defense ministry told Reuters on Wednesday.

European Union foreign ministers on Monday approved 250 troops to help train Malian soldiers. But, like the United States, the EU has ruled out a combat role.

O'Brien, appointed in September due to concerns about "the developing terrorist, security and humanitarian situation" in the region, said Britain had not yet made any commitment to aid the intervention in Mali but his visit aimed to negotiate a possible role.

France, Spain, Italy and Belgium have indicated willingness to take part in the Mali mission.

Referring to ongoing talks West African mediators are holding with the secular Tuareg rebel group MNLA and the Islamist Ansar Dine, O'Brien said it would be counterproductive to talk with groups that continued to use violence and "terrorist practices".

However, he added: "(If) any part of Ansar Dine is either not using, or is prepared to renounce, violence and to break any links with AQIM, then that becomes a possibility."

Groups that come to a negotiated deal would be spared from the offensive but al Qaeda-linked MUJWA and AQIM are not being considered for talks, O'Brien said.

(Editing by Tim Cocks and Robin Pomeroy)

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Turkey asks NATO for missile defense against Syria

BRUSSELS (Reuters) - NATO said on Wednesday it would consider a Turkish request to deploy Patriot missiles on its territory to help it defend itself against any Syrian attacks.

Ankara's bid for the missiles followed talks with NATO allies about how to shore up security on the 900-km (560-mile) border with Syria after mortar rounds landed on Turkish territory, increasing concerns about the civil war spilling over into Syria's neighbors.

The head of NATO said the alliance would discuss the request "without delay", while ambassadors from the 28 NATO members convened a meeting at the alliance's Brussels headquarters.

"Such a deployment would augment Turkey's air defense capabilities to defend the population and territory of Turkey," Secretary-General Anders Fogh Rasmussen said.

"It would contribute to the de-escalation of the crisis along NATO's south-eastern border."

Rasmussen has said any missile deployment would be a defensive measure to counterattacks, and not to enforce a no-fly zone over Syria. Rebels fighting President Bashar al-Assad's forces have called for a no-fly zone as they are almost defenseless against Syria's air force.

Germany Foreign Minister Guido Westerwelle said on Wednesday he had told his ambassador to NATO to approve Turkey's request.

Germany, the Netherlands and the United States, are the only three NATO allies with appropriate systems available.

The Dutch government said it would consider the request.

NATO has deployed Patriot surface-to-air missiles to Turkey twice before, once in 1991 and again in 2003, during both Gulf Wars. Those missiles were provided by the Netherlands.

Ankara twice this year has invoked Article 4 of the NATO charter which provides for consultations when a member state feels that its territorial integrity, political independence or security is under threat.

But some experts said deploying Patriots to Turkey would be partly symbolic, aimed at showing that NATO was behind Turkey.

Manufacturer Raytheon says Patriot provides "a reliable and lethal capability to defeat advanced threats, including aircraft, tactical ballistic missiles, cruise missiles and UAVs (drones)".

(Reporting by Sebastian Moffett and Justyna Pawlak; Editing by Michael Roddy)

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South Sudan, Sudan trade accusations in setback to peace deal

JUBA/KHARTOUM (Reuters) - Sudan and South Sudan accused one another of incursions in disputed border areas on Wednesday, jeopardizing plans to secure the boundary and resume cross-border oil flows.

The two former civil war foes agreed in September to end hostilities and restart vital southern oil exports through Sudan after coming close to war again in April, the worst violence since the south became independent in July 2011.

But relations have soured again in the past few days after both sides failed to agree on how to move their forces back from the unmarked joint border, something both had said must happen before oil exports resume.

South Sudan's army said Sudanese warplanes had bombed its side of the border, killing one civilian and wounding four others, in the first such accusation since the September deal.

"Sudan bombed our people in Northern Bahr al Ghazal. The bombing happened yesterday at 2 p.m.," army spokesman Philip Aguer said. "We were caught by surprise."

Sudan denied the accusation, saying they had attacked a camp some 40 km (25 miles) inside Sudanese territory used by rebels who are fighting the Khartoum government.

"The armed forces conducted an internal battle deep in its territory," Sudanese military spokesman Al-Sawarmi Khalid said in a statement on Wednesday.

"The presence of South Sudan's army in the area ... represents aggression and blatant military intervention on our land, and we have the full right to respond by dealing with them as enemy forces," he said.

Khartoum has long accused South Sudan of backing rebels fighting the Sudanese government, something analysts find credible despite denials from Juba.

REBEL FIGHTING

Fighting between Sudan and rebels near its southern border has hampered the plan to set up a border zone. On Monday, Sudan's state news agency SUNA said rebels from the Darfur region had set up camp in a disputed border region.

Khalid said then that the rebels had been positioned just 10 km from the border in a disputed strip of land called Samaha, or Miles-14, that was a major obstacle during the September talks.

Any delay to a resumption of the oil trade would be a serious blow to both countries.

Sudan benefits from South Sudan's oil exports because Juba has to pay a fee for using northern pipelines and a Red Sea port. Juba halted production in January because of disputes over pipeline fees with Sudan.

South Sudan's President Salva Kiir said on Tuesday the resumption of oil production had been delayed after Sudan had made further demands.

Concerns about delays to reopening the oil pipeline pushed the Sudanese pound to a historic low at the start of the week, highlighting the need to restart oil flows, the main source of state revenues and dollars for both countries.

Analysts say while both governments need the oil they also want to be seen as tough on the other side to shore up domestic support.

(Reporting by Charlton Doki in Juba and Khalid Abdelaziz in Khartoum; Writing by Ulf Laessing and Alexander Dziadosz; Editing by Louise Ireland)

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Hamas and Israel agree ceasefire: sources

GAZA/JERUSALEM (Reuters) - Israel and Hamas agreed on Wednesday to a ceasefire brokered by Egypt on the eighth day of intensive Israeli fire on the Gaza Strip and militant rocket attacks out of the enclave, Israeli, Palestinian and Egyptian sources said.

First word of the truce came from a Palestinian official who has knowledge of the negotiations in Cairo, where U.S. Secretary of State Hillary Clinton was also pursuing peace efforts.

Asked whether a ceasefire deal had been reached, an Egyptian official in Cairo said: "Yes, and Egypt will announce it."

Egyptian state TV had earlier said a news conference would be broadcast from President Mohamed Mursi's palace shortly.

Israeli sources said Israel had agreed to a truce, but would not lift its blockade of the Palestinian territory, which is run by the Islamist Hamas movement.

All the sources declined to be named or to give further details of the arrangements hammered out in Cairo.

More than 140 Palestinians and five Israelis have been killed in the fighting that began last Wednesday.

The ceasefire, if confirmed, was forged despite a bus bomb explosion that wounded 15 Israelis in Tel Aviv earlier in the day and despite more Israeli air strikes on the Gaza Strip.

After talks in Ramallah with Palestinian President Mahmoud Abbas, Clinton held a second meeting with Israeli Prime Minister Benjamin Netanyahu before travelling to Egypt for discussions with Mursi, whose country has led mediation efforts.

In Tel Aviv, targeted by rockets from Gaza that either did not hit the city or were shot down by Israel's Iron Dome interceptor system, 15 people were wounded when a bus was blown up near the Defence Ministry and military headquarters.

The blast, which police said was caused by a bomb placed on the vehicle, touched off celebratory gunfire from militants in Gaza and had threatened to complicate truce efforts. It was the first serious bombing in Israel's commercial capital since 2006.

In Gaza, Israel struck more than 100 targets, including a cluster of Hamas government buildings, in attacks that medical officials said killed 10 people, among them a 2-year-old boy.

Israel's best-selling Yedioth Ahronoth newspaper had reported an emerging outline of a ceasefire agreement that called for Egypt to announce a 72-hour ceasefire followed by further talks on long-term understandings.

Under the proposed document, which the newspaper said neither party would be required to sign, Israel would hold its fire, end attacks against top militants and promise to examine ways to ease its blockade of Gaza, controlled by Hamas Islamists who do not recognize the Jewish state's right to exist.

Hamas, the report said, would pledge not to strike any Israeli target and ensure other Palestinian factions in the Gaza Strip also stop their attacks.

Israel has carried out more than 1,500 strikes since the offensive began with the killing of a top Hamas commander and with declared aim of deterring Hamas from launching rocket attacks that have long disrupted life in its southern towns.

Medical officials in Gaza said 146 Palestinians, more than half of them civilians, including 36 children, have been killed in Israel's offensive. Nearly 1,400 rockets have been fired into Israel, killing four civilians and a soldier, the military said.

(Additional reporting by Ori Lewis and Crispian Balmer in Jerusalem, Nidal al-Mughrabi in Gaza and Yasmine Saleh in Cairo)

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Ivory Coast's Ouattara names ex Foreign Minister as PM

ABIDJAN (Reuters) - Ivory Coast's President Alassane Ouattara has named Daniel Kablan Duncan, a member of his allied PDCI party, as his new prime minister, Ouattara's office said on Wednesday.

The nomination of Duncan, who previously served as foreign minister, ensures that Ouattara sticks to a deal that saw the PDCI throw its weight behind Ouattara during a 2010 election run off in return for the prime minister's job.

Ouattara dissolved his government last week in a surprise move, citing the lack of solidarity within his coalition.

(Reporting by Loucoumane Coulibaly; Writing by David Lewis; Editing by Richard Valdmanis)

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World powers want new nuclear talks with Iran quickly

BRUSSELS (Reuters) - Six world powers agreed on Wednesday to seek renewed talks with Iran as fast as possible, reflecting a heightened sense of urgency to resolve a long rift over Tehran's disputed nuclear activity and avert the threat of war.

Their call coincided with growing evidence of Iran expanding nuclear capacity in an underground bunker virtually impervious to attack and follows the November 6 re-election of U.S. President Barack Obama, which has cleared the way for new contacts.

Senior diplomats from the six countries - the United States, Russia, China, France, Britain and Germany - met in Brussels on Wednesday to consider new negotiating tactics despite abiding skepticism that a deal with Tehran can be reached.

It was not clear after the meeting what options, if any, were agreed. But the six said "necessary contact" with the Iranians would be made "in the coming days".

"The (six powers) are committed to having another round of talks with Iran as soon as possible," said a spokesman for EU foreign policy chief Catherine Ashton, who represents the six countries in dealings with Iran.

Analysts warn that a window of opportunity for a negotiated solution is narrowing because of growing alarm over Tehran's nuclear course in Israel, the Middle East's only nuclear power which has threatened to bomb the atomic sites of its arch-enemy.

Any Israeli air strikes, which many believe would escalate into a wider Middle East war damaging to a wobbly global economy, is unlikely before Israel's January 22 election, experts say, giving the six powers some room for diplomatic maneuver.

"There certainly is a window to do a deal, but that window is closing, and closing fast. Ultimately it depends on the Iranians meeting their international obligations," said Ariel Ratner, a former Obama administration political appointee on Middle East issues at the State Department.

By "obligations", he was referring to U.N. Security Council resolutions telling Iran to suspend uranium enrichment, the main pathway to nuclear bomb fuel, and open up to U.N. nuclear inspectors in exchange for trade and technology benefits.

Iran's defiance of the resolutions, rejecting suspicions that it is refining uranium for anything other than peaceful energy, has prompted increasingly harsh sanctions on Tehran.

After three inconclusive rounds of talks with Iran earlier this year, Western diplomats say the six negotiators need a new approach to engineer a deal with the Islamic Republic.

UNDERGROUND NUCLEAR ENRICHMENT

The stakes have risen since diplomacy resumed in April after a hiatus of more than a year, they say, with a U.N. watchdog report last week showing Iran is set to sharply expand uranium enrichment in its bunkered Fordow plant.

Iran denies international accusations it is seeking nuclear weapons and has so far refused to meet demands to scale back its atomic activity, insisting on immediate relief from sanctions.

Western powers have rejected that in previous rounds, instead offering limited incentives focused on technology cooperation. They have also ramped up punitive measures intended to get Iran, one of the world's biggest oil producers and exporters, back to the table for meaningful talks.

Sanctions pressure increased last month when European Union governments tightened restrictions on trading with Tehran and banned imports of Iranian gas, complementing a crippling embargo on Iranian crude oil that took full effect on July 1.

Diplomats say one option being considered by the six powers is to ask Iran for more concessions while offering more substantial sanctions relief.

"With more space in Washington and more pressure in Tehran, there might just be room for a deal," said Jon Wolfsthal, a former adviser to U.S. Vice President Joe Biden. "Sanctions relief has to be on the table at some point, but Iran has to be able to get to 'yes'."

In the earlier meetings this year, the powers called on Iran to stop producing higher-grade enriched uranium, shut down the Fordow facility and ship its stockpile abroad.

Iran rebuffed the proposal, described by Western officials as an initial step to build confidence, and demanded recognition of its "right" to refine uranium, activity which can have both civilian and military purposes, as well as sanctions dropped.

Any new deal would have to be carefully choreographed to entice Iran to make concessions while taking into account deep-seated reluctance among Western governments to ease sanctions.

"The key is sequencing the significant steps," said Cliff Kupchan, a Middle East analyst at consultancy Eurasia Group. "My guess is that's what they (the six powers) will discuss."

Iranian central bank governor Mahmoud Bahmani told Reuters on Thursday that it had avoided a "serious dent" to its economy from sanctions thanks to gold reserves sufficient to last 15 years, high oil prices and reduced imports.

The sanctions have caused the rial currency to plummet, inflation to jump and hundreds of thousands of job losses.

(Additional reporting by Fredrik Dahl in Vienna, Peter Apps in Washington, Randy Fabi and Aisha Chowdhry in Islamabad; Editing by Mark Heinrich)

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Israel sees long days of Gaza combat, moots invasion

JERUSALEM (Reuters) - Israel's aerial assault on the Gaza Strip on Wednesday could draw cross-border Palestinian rocket attacks and stretch into days of fighting, including a ground offensive if required, the Israeli military said.

"The days we face in the south will, in my estimation, prove protracted," Brigadier-General Yoav Mordechai told Channel 2 TV after Israeli air strikes killed the military chief of Gaza's Hamas government. "The homefront must brace itself resiliently."

Mordechai said Israel was both responding to a surge in Palestinian rocket salvoes earlier this week and trying to prevent Hamas and other Palestinian factions from building up their arsenals further.

Among the targets of Wednesday's air strikes were underground caches of longer-range Hamas rockets, he said.

Asked if Israel might send ground forces into Gaza, Mordechai said: "There are preparations, and if we are required to, the option of a entry by ground is available."

(Writing by Dan Williams; Editing by Crispian Balmer)

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U.S. stops short of recognizing Syrian opposition body

BEIRUT (Reuters) - The United States declined to follow France in fully recognizing a fledgling Syrian opposition coalition on Wednesday, saying the body must prove its worth, after its predecessor was dogged by feuding and accusations of Islamist domination.

Syria decried the new grouping, which it said had closed the door to a negotiated solution with President Bashar al-Assad.

"The whole world, and Syria too, says the problem in Syria should be solved in a peaceful framework and through a national dialogue, (but) the first decision taken after forming the coalition in Doha was to reject dialogue and to continue the war," Deputy Foreign Minister Faisal Mekdad said.

"They want to destroy Syria," he told Russia Today in an interview that was also carried on Syria's state news agency.

U.S. Secretary of State Hillary Clinton said the formation of the coalition, which supersedes the widely discredited Syrian National Council as the face of the Syrian opposition, was an important step, but did not offer it full recognition or arms.

"We have long called for this kind of organization. We want to see that momentum maintained," Clinton told reporters in the Australian city of Perth. "As the Syrian opposition takes these steps and demonstrates its effectiveness in advancing the cause of a unified, democratic, pluralistic Syria, we will be prepared to work with them to deliver assistance to the Syrian people."

The new body brings the Syrian National Council, the hapless former main opposition group seen as under the sway of Islamists and out of touch with rebels on the ground, into a broader bloc with factions inside and outside Syria including rebel fighters, veteran dissidents and ethnic and religious minorities.

On Tuesday France hailed the Syrian National Coalition for Opposition and Revolutionary Forces "as the sole legitimate representative of the Syrian people and as future government of a democratic Syria" - the first Western power to go that far.

Six Gulf Arab states had taken that step the day before, but the Arab League and most European countries hung back.

President Francois Hollande's decisive posture on Syria recalled that of his predecessor Nicolas Sarkozy on Libya last year, when France led calls for NATO action to protect civilians that effectively helped Libyan rebels topple Muammar Gaddafi.

The European Union bans weapons sales to Syria, but Hollande said the question of arming rebels would be examined once the coalition formed a transitional government. Paris had previously ruled this out, fearing arms could reach Islamist militants.

"NO EXCUSE"

Suhair al-Atassi, a vice president of the new coalition, said that once it had proved it represents "revolutionary forces" on the ground, there would be no pretext for Western powers not to provide some form of military backing.

"The ball now is in the international community's court," she told Reuters in an interview in Doha, blaming Western reticence to arm the rebels for the rise of extremism in Syria.

"There is no more excuse to say we are waiting to see how efficient this new body is. They used to put the opposition to the test. Now we put them to the test," she declared.

Syrian insurgents have few weapons against Assad's air force and artillery, which can pound rebel-held territory at will.

A Syrian warplane bombed the town of Ras al-Ain near the Turkish border again on Wednesday, rocking buildings on the frontier and sending up huge plumes of smoke, in the latest of several air strikes since rebels captured the town last week.

Air force jets also attacked rebel enclaves in Damascus, an opposition activist in the Syrian capital said.

"The planes are firing rockets at the neighborhoods of Qaboun and Jobar. They are flying high and you can hear the impact of the rockets," Yasmine al-Shami said by phone.

Israel, which twice shot back this week after stray Syrian fire hit the Israeli-occupied Golan Heights, said rebels held most of the villages on the ridge's eastern slopes.

Israeli Defence Minister Ehud Barak said on a trip to the Golan that Assad's grip was undergoing "painful disintegration" and his military was becoming less efficient.

"Almost all of the villages at the foot of this ridge, and on upward, are already in rebel hands," Barak said on the Golan, captured from Syria during the 1967 Arab-Israeli war.

The conflict in Syria has already cost more than 38,000 lives in the past 20 months. The Syrian Observatory for Human Rights, which monitors the conflict via a network of contacts, reported 210 deaths on Tuesday alone.

Assad's foes have been divided throughout the struggle, but a more inclusive opposition coalition, led by Damascus preacher Mouaz Alkhatib, emerged on Sunday after days of talks in Qatar.

Alkhatib will fly to London on Thursday and meet Britain's foreign minister and senior French and Qatari officials the next day, according to Syrian coalition officials.

French Foreign Minister Laurent Fabius said the Syrian leader had also been invited to Paris.

Clinton announced an extra $30 million in aid to those affected by the war in Syria, to be delivered via the United Nations' World Food Programme, which is supplying food to more than a million people in Syria and to 408,000 Syrian refugees.

The United States says it is sending only humanitarian aid and non-lethal assistance to Assad's opponents, but acknowledges that some of its allies are arming the rebels - something which Russia says shows Western powers want to decide Syria's future.

Russia and China have blocked any U.N. Security Council action on Syria, prompting Washington and its allies to say they could move beyond U.N. structures for their next steps.

So far, concerted action on Syria has been thwarted by divisions within the opposition, as well as by big power rivalries and a regional divide between Sunni Muslim foes of Assad and his Shi'ite Muslim allies in Iran and Lebanon.

An Iranian Revolutionary Guards general blamed Western, Turkish and Arab meddling for the bloodshed in Syria.

"They must leave the government and people of Syria alone so they can take the necessary decision about the kind of government in Syria," Brigadier-General Massoud Jazayeri was quoted as saying by the semi-official Fars news agency.

(Additional reporting by Khaled Yacoub Oweis in Amman, John Irish in Paris, David Brunnstrom in Perth, Australia, Rania El Gamal in Doha, Dan Williams in Jerusalem and Jonathon Burch in Ceylanpinar, Turkey; Writing by Alistair Lyon; Editing by Mark Heinrich)

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In war-torn Syria, secrets and double lives

IDLIB, Syria (Reuters) - Every morning, Amjad goes through two army checkpoints to attend a school run by the Syrian government. Every night, he sits by his father's side to plot attacks to bring that government down.

Amjad doesn't see the strangeness of his predicament - reciting chants of loyalty to President Bashar al-Assad in the army-controlled city where his school is, and going home to a village where everyone knows his father's rebel unit just blew up an Assad tank convoy.

To the scrawny 16-year-old, living a double life has become the norm, as it has for many as the country's 19-month-old uprising descends into civil war.

"Sometimes at the checkpoints when they see where I come from they ask me about certain rebels from my village, to test me, but I haven't messed up yet. Or they make me say if I'm pro or anti, so I say I'm pro-Assad," says Amjad.

His school is one of the few still functioning in the war-torn northern Idlib province, and he asked that his village not be named for fear of exposing his identity.

"It's humiliating, but my dad insists I finish my studies, he doesn't want my future destroyed because of the revolution."

When Syria's revolt began as a peaceful protest movement, many participants said it was a moment when hidden views were shared honestly for the first time. They described it as a time that brought fellow Syrians together.

But Assad's crackdown has transformed their movement into a bloody armed revolt and the conflict, in which more than 32,000 people have died, is tearing the country apart, dividing friends and families and spinning a web of secrets between neighbors.

In the rebel-held northern town of Atareb, where daily air raids have reduced half the buildings to rubble, a woman stands on her doorstep singing blessings to the fighters who pass by. No one in the town but her family knows her son is a devoted Assad soldier.

"My son believes he's doing the right thing. I love him so I accept that," says the wrinkled, greying woman, as she and her children pick shrapnel out of the kitchen - remnants of rockets fired indiscriminately by the army her son is fighting for.

The woman, who asked not to be named, hasn't seen her oldest son in a year, and she hardly speaks to her neighbors now. Her family keeps to itself for fear that too many questions may expose their secret. It is agonizing and lonely, she says, but she fears being driven from home if the truth was discovered.

"Everyone in the town thinks my son is working abroad, and I keep it that way. In a situation like this, people feel it's 'with us or against us'. I personally am with no one, I am against the whole thing. It's killing our children."

HIDING FROM THE NEIGHBOURS

With the lines of loyalties drawn, the cost of those classifications can be deadly for men like Ahmed, a Shi'ite Muslim fighting with the Sunni-led rebels. Syria's conflict has increasingly been infused with sectarian overtones.

Assad is a member of Syria's Alawite minority sect, an offshoot of Shi'ite Islam, and has been supported by Shi'ite power Iran. Syria's majority Sunni population has been the driving force of the uprising, and rebels get most of their support from Iran's Sunni Arab rivals in the Gulf.

"My family are opposition sympathizers but we're from a Shi'ite town that supports Assad. If the neighbors knew I had defected to the rebels, my family would be targeted," says the pale 20-year-old fighter, who walks with a slight limp.

Ahmed has not even spoken to his family since he fled, hoping the lack of contact will protect them. "They don't even know I've been wounded twice fighting here on the border."

Both times he was hurt, a comrade lent him his identity card, in case pro-Assad spies were lurking at the hospital in Turkey where he was being treated. Ahmed fears even calling his family could put them in danger.

"I don't know if they're all alive or not. But this is a normal part of war, I think. We don't know each other anymore."

Beyond the fear of spies and betrayal, there are plenty of mundane reasons to cover up one's identity in Syria these days.

The battle lines may be set between Assad's forces and the rebels, but most Syrians still navigate daily between areas controlled by each side in order to hang on to their jobs and homes, or simply to get to the local marketplace.

For Abu Obeid, a rebel fighting in the northern city of Aleppo, the choice to keep a secret life is pure economics.

Once a school teacher at a government-run elementary school, he now spends his days behind sandbags in a dark alleyway of Aleppo's ancient Old City, trading fire with Assad's snipers.

But every month, he goes to the education ministry to pick up his salary. His school, like most in the area, has been closed since Aleppo, Syria's largest city, became one of the main battlegrounds of the conflict three months ago. Clashes erupt day and night and shelling and explosions are constant.

Despite the closures, the state has continued paying salaries to those it does not suspect of joining the opposition.

"I am keeping my work as a rebel secret because I need the money for my wife and children," he says, winking. "You don't get paid to be a rebel."

(Editing by Philippa Fletcher)

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Congo mutineer linked to M23 rebels surrenders

KINSHASA (Reuters) - A leading army mutineer allied to the M23 rebellion in eastern Democratic Republic of Congo has surrendered, the government said on Wednesday, claiming it as a major blow to the insurgents.

Eastern Congo has been swept by violence since the beginning of the year after hundreds of soldiers defected and launched M23, which says it wants to overthrow President Joseph Kabila.

More than 760,000 people have fled their homes since.

Colonel Albert Kahasha, accompanied by 35 fighters from other rebel groups linked to the killings of hundreds this year, surrendered in the South Kivu capital of Bukavu on Monday, government spokesman Lambert Mende said, describing Kahasha as a "big fish".

"He didn't like the direction taken by M23, who he was allied with ... He had been sent to open up another front of fighting in South Kivu," Mende told Reuters, adding that his decision was a blow for the rebels.

M23 spokesman Colonel Vianney Kazarama confirmed links with Kahasha but denied they were fighting together.

"We gave him freedom of circulation in our zone... ideologically he was with us but not in any military sense. If he wants to re-integrate back into the FARDC (national army), that's his problem," Kazarama told Reuters.

Kahasha surrendered along in with commanders from the Raia Mutomboki and the Nyatura armed groups. The United Nations has said the groups were behind a spate of ethnically motivated tit-for-tat massacres between April and September which left at least 264 people dead.

The U.N.'s joint human rights office (UNJHRO) published a report documenting brutal attacks on isolated villages in Masisi territory, North Kivu, with many victims killed by machete blows or burnt alive in their houses.

Nyatura was working alongside the FDLR, an ethnically Hutu Rwandan rebel group operating in Congo, which has been behind some of the region's worst atrocities in recent years.

Raia Mutomboki - meaning "outraged citizens" in the local Swahili language - is an self-defense group which has spread from South Kivu, feeding off widespread xenophobic and anti-Rwandan sentiment.

"The risk of intensification of ethnic violence gives rise to serious concerns for the peace and security of civilians in the region," the report said.

(Writing by Richard Valdmanis; Editing by Michael Roddy)

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