Suicide bombers attack U.S. base in Afghanistan

JALALABAD, Afghanistan (Reuters) - Suicide attackers detonated bombs and fired rockets outside a major U.S. base in Afghanistan on Sunday, killing five people in a brazen operation that highlighted the country's security challenges ahead of the 2014 NATO combat troop pullout.

Local police officials said bodies in Afghan police and military uniforms were scattered around the entrance of the airfield in the eastern city of Jalalabad after a two-hour battle. A Taliban spokesman said the militant group had launched the 6 a.m. assault.

The Taliban, who have been fighting U.S.-led NATO and Afghan forces for more than a decade, sometimes dress in uniforms for attacks.

Two suicide bombers died after blowing themselves up in cars, said Nasir Ahmad Safi, a spokesman for the provincial government.

Seven other bombers were killed in the a gunbattle with Afghan and coalition forces. Three Afghan soldiers and two civilians also died, said Safi.

U.S. helicopters circled overhead.

"There were multiple suicide bombers involved," said Major Martyn Crighton, a spokesman for the NATO-led International Security Assistance Force (ISAF).

Several coalition troops were wounded, he said.

The United States and Afghan government are scrambling to stabilize Afghanistan before most NATO combat troops withdraw at the end of 2014 and hand over security to Afghan forces.

Some Afghans doubt government security forces will be able to defend the country against any Taliban attempts to seize power again after foreign troops withdraw. There are also growing fears that a civil war will erupt.

President Hamid Karzai's government say Afghan security forces have made good progress.

Afghanistan's defense ministry spokesman said there were rocket attacks at the Jalalabad base followed by suicide bombings.

In a text message, Taliban spokesman Zabihullah Mujahid said : "This morning at 6 a.m. a number of our devotees attacked the major U.S. Base in Jalalabad city and so far have brought heavy casualties to the enemy."

In February, a suicide car bomber killed nine people at the base, almost exclusively used by NATO and the U.S. military.

(Additional reporting by Martin Petty in KABUL; Writing by Michael Georgy; Editing by Ron Popeski)

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North Korea plans new rocket launch as leader asserts power

SEOUL (Reuters) - North Korea said it would carry out its second rocket launch of 2012 as its youthful leader Kim Jong-un flexes his muscles a year after his father's death, in a move that South Korea and the United States swiftly condemned as a provocation.

North Korea's state news agency announced the decision to launch another space satellite on Saturday, just a day after Kim met a senior delegation from China's Communist Party in the North Korean capital of Pyongyang.

China, under new leadership, is North Korea's only major political backer and has continually urged peace on the Korean peninsula, where the North and South remain technically at war after an armistice, rather than a peace treaty, ended the 1950-53 conflict.

China's Foreign Ministry said it was deeply concerned by the move, but urged calm.

"North Korea has a right to the peaceful use of space, but this right has been restricted by U.N. Security Council resolutions. (China) hopes all sides can do more to benefit peace and stability on the peninsula, and hopes all sides handle it calmly to avoid the situation escalating," ministry spokesman Qin Gang said in a statement.

In Washington, U.S. State Department spokeswoman Victoria Nuland condemned the launch plan as a provocative threat to the Asia-Pacific region that would violate United Nations resolutions imposed on Pyongyang after past missile tests.

"A North Korean 'satellite' launch would be a highly provocative act that threatens peace and security in the region," she said in a written statement.

North Korea has notified its neighbors of the proposed flight path, an unnamed South Korean official told Yonhap news agency on Sunday, saying that it would take a similar path to a failed rocket launch in April this year.

That was supposed to take the rocket over seas separating China and the Korean peninsula where the first stage of the rocket would drop into the sea, then to pass over Okinawa. The second stage was to fall in seas off the Philippines.

Pentagon spokesman George Little said, "North Korea must abide by its international obligations under U.N. Security Council resolutions that clearly articulate what it can and cannot do with respect to missile technologies."

Seoul's foreign ministry called the move a "grave provocation." Japan's Kyodo news agency said Prime Minister Yoshihiko Noda had ordered ministries to be on alert for the launch.

"North Korea wants to tell China that it is an independent state by staging the rocket launch and it wants to see if the United States will drop its hostile policies," said Chang Yong-seok, a senior researcher at the Institute for Peace Affairs at Seoul National University.

North Korea is banned from conducting missile or nuclear-related activities under U.N. resolutions imposed after earlier nuclear and missile tests. The country says its rockets are used to put satellites into orbit for peaceful purposes, but that assertion is not widely accepted outside of Pyongyang.

Washington and Seoul believe that the impoverished North is testing long-range missile technology with the aim of developing an intercontinental ballistic missile capable of carrying a nuclear warhead.

Pyongyang's threats are aimed, in part, at winning concessions and aid from Washington, analysts say.

POLITICS AND ANNIVERSARIES

The failed April rocket launch took place to celebrate the 100th anniversary of the birth of North Korea founder Kim Il Sung and the latest test will take place close to the December 17 date of the death of former leader Kim Jong-il.

It will also come as South Korea gears up for a December 19 presidential election in a vote that pits a supporter of closer engagement with Pyongyang against the daughter of South Korean dictator Park Chung-hee.

The April test was condemned by the United Nations, although taking action against the North is hard as China refuses to endorse further sanctions against Pyongyang.

North Korea is already one of the most heavily sanctioned states on earth thanks to its nuclear program.

Pyongyang has few tools to pressure the outside world to take it seriously due to its diplomatic isolation and its puny economy.

The state that Kim Jong-un inherited last December after the death of his father boasts a 1.2 million-member military, but its population of 23 million, many malnourished, supports an economy worth just $40 billion annually in purchasing power parity terms, according to the U.S. Central Intelligence Agency.

"The North's calculation may be that they have little to lose by going ahead with it at this point," said Baek Seung-joo of the Korea Institute for Defense Analyses in Seoul.

Baek said the test planned for December would likely be no more successful in launching a satellite than the April one that crashed into the sea between China and North Korea after flying just 120 km (75 miles).

"Kim Jong-un may be taking a big gamble trying to come back from the humiliating failure in April and in the process trying to raise the morale for the military," Baek said.

North Korea's space agency said on Saturday that it had worked on "improving the reliability and precision of the satellite and carrier rocket" since April's launch.

(Additional reporting by Jack Kim, Jumin Park and Sung-won Shim in SEOUL, John Ruwitch in SHANGHAI, Ben Blanchard and Niu Shuping in BEIJING and Andrew Quinn, Paul Eckert and David Alexander in WASHINGTON; Editing by Ron Popeski, Doina Chiacu and Daniel Magnowski)

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Iran pushes out Afghans as regional power-play heats up

HERAT, Afghanistan (Reuters) - Ghaus worked in Iran for five years but has nothing to show for it. All he has are memories of being jailed, beaten and sent home to Afghanistan.

Afghanistan's oil-rich western neighbor has for years been a destination for Afghans seeking work or fleeing war. Afghanistan and Iran share a language, and cultural and historical links.

But hostility to the U.S. role in Afghanistan, regional ambitions and an economy choked by Western sanctions have persuaded Iran to cast out Afghan migrants, to the dismay of those forced home and their government.

In May, Iran threatened to expel Afghan refugees and migrant workers, in all about 2.4 million people, if Afghanistan signed a strategic security pact with the United States. The deal was struck.

"Afghan refugees and migrants are becoming the victims of big political games played between the Iranian and U.S. powers," said Abdul Samad Hami, Afghanistan's deputy minister for refugees.

Few of the migrants, who pay smugglers about $700 to get across the 1,000 km (620 miles) border into Iran, know they have been caught up in a geopolitical power play.

Barefoot and wearing a sun-bleached silver turban, Ghaus was huddled with about 20 other expelled migrants at a U.N. center in the western Afghan city of Herat after being dumped out of a bus on the border.

"Suddenly, my life came to an end," the soft-spoken bricklayer told Reuters.

Ghaus is one of 191,121 unregistered Afghan migrants forced out of Iran from January to September 30 this year, according to the U.N. refugee agency, up 29 percent from last year.

About 1.4 million migrant workers remain in Iran but hundreds of them are being expelled every day. There are also nearly a million Afghan refugees who are allowed to live there.

Shuffling home through Herat's Islam Qala border checkpoint, most of the returning migrants are young men dressed like Iranians in jeans and brightly colored bomber jackets, but with bulging suitcases and bed-rolls on their heads.

Many migrants have called Iran home for decades, part of an exodus of nine million Afghans - a third of the population - who fled to neighbors Iran and Pakistan, beginning with the Soviet invasion in 1979, through to the austere Taliban rule of the 1990s.

The expulsions represent not just a burden for Afghanistan but also a loss of income, and could even spell more instability ahead of the withdrawal of most foreign troops by the end of 2014.

Afghan migrants in Iran send home about $500 million a year, a considerable sum for one of the world's poorest countries. The funds will become more important as foreign aid shrinks with the departure of Western forces.

INFLUENCE, OPIUM

Iran says migrant workers pose a security threat. But Afghan politicians and analysts say Iran is pushing them out to show it can ratchet up the pressure when it doesn't get its way.

As the United States reduces its role in Afghanistan, neighbors are competing for influence. Iran already backs a third of Afghan media and builds schools and clinics to boost its sway, according to Afghan officials.

Iran's economic influence in Afghanistan is palpable in Herat, which enjoys robust trade over the nearby border and boasts smoothly paved roads and bustling markets.

Iran offers Afghan migrants menial work, often on construction sites. Many of the men return home addicted to opium after being paid in the drug instead of cash.

This is not only because it is cheaper for employers to pay in opium, but also because the depreciation of Iran's rial, in the face of international sanctions over its nuclear program, has made opium more attractive than cash for the workers.

"We were allowed to choose - money or drugs. Over time, drugs seemed the better option," said Rasool, a grey-bearded man who guarded a construction site in Iran's second-largest city of Mashhad for 15 years.

Like Ghaus, Rasool was briefly imprisoned in Iran before being expelled.

Some migrants end up in prison after getting home.

"We've noticed an increase in the number of migrants coming back here with drug addictions," said General Shah Mir, who oversees Herat's provincial prison, where almost 300 former migrant workers are doing time for opium trafficking.

Health officials estimate there are 1 million Afghans addicted to opium or heroin, or about 8 percent of the adult population, making it the world's top user per capita. It is also the top producer of opium and its refined form, heroin.

"TOUGH TALK"

But it is not just the migrant workers that Iran wants out.

It is also making moves to force out the majority of the 930,000 legal Afghan refugees and is stepping up a campaign to make them feel unwelcome, Afghan officials and rights group say.

Last month, Iran's Interior Ministry said a decision had been made to "end the status of asylum for 700,000 Afghans" by March 21, 2015.

An Interior Ministry spokesman declined to comment on the reason for the decision.

Faraz Sanei, Iran researcher at the New York-based Human Rights Watch, said Iran gets tough on repatriating Afghans when it feels pressured in the regional maneuvering for influence.

"When political tension between Tehran and Kabul is high, for example, with regard to the U.S. role in Afghanistan, Tehran has stepped up its tough talk," Sanei said.

Iran and Afghanistan, along with the United Nations High Commissioner for Refugees, agreed on a voluntary repatriation program in 2002 in the belief that with better security at home, the refugees should choose to go back.

"Though this has been the official government line, we have seen an increase in the restrictive measures against Afghan refugees in recent years that has made life in Iran increasingly difficult," said Sanei.

Iran has been increasing the number of "no-go areas" for Afghans, which authorities say is part of a strategy to secure its borders. Afghans are now allowed in 12 of Iran's 31 provinces, down from 14 last year.

"Even within the allowed areas, movement of Afghans is restricted and there are only certain jobs they can do," said Hami, the deputy minister for refugees.

Afghans have even been banned from certain public parks, Iranian media has reported.

Hami said Afghanistan had been preparing for the expulsion of refugees for some time and was mapping out a "contingency plan" with the U.N. refugee agency that should be ready by January.

For Herat member of parliament Qazi Nazir Ahmad Hanfai, the reason Iran is putting pressure on Afghans living there is clear: Iran is punishing Afghanistan for defying its call to reject the U.S. security pact.

"The Iranians warned the Afghans ... and now we're seeing the result of that threat," Hanfai said.

(Additional reporting by Mirwais Harooni in KABUL and Yeganeh Torbati in DUBAI; Editing by Michael Georgy and Robert Birsel)

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At least three dead after Japan tunnel collapse: TV

TOKYO (Reuters) - A tunnel on a major highway in central Japan collapsed on Sunday, killing at least three people and starting a blaze, Japanese media reported.

Attempts to rescue those still trapped inside the smashed tunnel, which began spewing smoke after concrete ceiling panels fell onto the road, have been interrupted for fear they might trigger another collapse.

Three bodies have been found so far, television networks Fuji and Asahi said.

The fire service earlier said at least seven people were unaccounted for in the 4.7 km (2.8-mile) tunnel in Yamanashi prefecture, about 80 km (50 miles) west of Tokyo on the Chou Expressway, a main road connecting the capital to western Japan.

"Dense smoke was coming out as if it covers the entire mountain," witness Kiyoko Toyomura told Japanese news agency Kyodo.

The fire service said the blaze was extinguished about 11 a.m. - some three hours after the accident occurred.

The operator of the highway, Central Nippon Expressway, said a 50-60 meters (165 feet) long section of ceiling panels fell to the road, and it was looking into the cause of the accident.

Motorists described narrow escapes from falling debris, and a long walk through the darkness after abandoning their cars.

"When I was driving in the tunnel, concrete pieces fell down suddenly from the ceiling," a man in his 30s told public broadcaster NHK. "I saw a crushed car catching fire. I was frightened, left my car and walked for about an hour to get out of the tunnel."

In 1996 a tunnel in Hokkaido, northern Japan, collapsed and falling rocks crushed cars and a bus, killing 20 people.

NHK reporter Yoshio Goto, caught in Sunday's accident, hit the accelerator and managed to drive out.

"But it was a bit too late and pieces of ceiling fell on my car. I kept pressing the pedal and managed to get out," he said. "Then when I looked around, I saw half of the car ceiling was crushed."

(Reporting by Hideyuki Sano; Editing by Daniel Magnowski)

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Islamist protest shuts down Egypt's top court

CAIRO (Reuters) - Protests by Islamists allied to President Mohamed Mursi forced Egypt's highest court to adjourn its work indefinitely on Sunday, intensifying a conflict between some of the country's top judges and the head of state.

The Supreme Constitutional Court said it would not convene until its judges could operate without "psychological and material pressure", saying protesters had stopped the judges from reaching the building.

Several hundred Mursi supporters had protested outside the court through the night ahead of a session expected to examine the legality of parliament's upper house and the assembly that drafted a new constitution, both of them Islamist-controlled.

The cases have cast a legal shadow over Mursi's efforts to chart a way out of a crisis ignited by a November 22 decree that temporarily expanded his powers and led to nationwide protests.

The court's decision to suspend its activities appeared unlikely to have any immediate impact on Mursi's drive to get the new constitution passed in a national referendum on December 15.

Three people have been killed and hundreds wounded in protests and counter-demonstrations over Mursi's decree.

At least 200,000 of Mursi's supporters attended a rally at Cairo University on Saturday. His opponents are staging an open-ended sit-in in Cairo's Tahrir Square, the cradle of the uprising that toppled Hosni Mubarak in February 2011.

Mursi and the Muslim Brotherhood, which propelled him to power in a June election, hope to end the crisis by pushing through the new constitution hastily adopted by the drafting assembly on Friday. The next day the assembly handed the text to Mursi, who called the referendum and urged Egyptians to vote.

"The Muslim Brotherhood is determined to go ahead with its own plans regardless of everybody else. There is no compromise on the horizon," said Hassan Nafaa, a professor of political science at Cairo University.

Outside the Supreme Constitutional Court, Muslim Brotherhood supporters rallied behind the referendum date. "Yes to the constitution", declared a banner held aloft by one protester. Chants demanded the "purging of the judiciary".

The interior minister told the head of the court that the building was accessible and the protests were peaceful, according a statement from the ministry.

The protest reflected the deep suspicion harbored by Egypt's Islamists towards a court they see as a vestige of the Mubarak era. The same court ruled in June to dissolve the Muslim Brotherhood-led lower house of parliament.

Since then, several legal cases have challenged the legitimacy of the upper house of parliament and the 100-member constituent assembly that wrote the constitution.

Those against the upper house have focused on the legality of the law by which it was elected, while the constitutional assembly has faced a raft of court cases alleging that the way it was picked was illegal.

STOCK MARKET RALLIES

Mursi believes that securing approval for the new constitution in a popular referendum will bury all arguments on the legality of the constituent assembly, as well as controversy over the text it worked through the night to finish on Friday.

It will also override the November 22 decree that prompted statements of concern from Western governments and a rebellion by sections of the judiciary that saw it as a threat to their role. The decree shielded Mursi from judicial oversight.

Judges supervise voting in Egypt, so Mursi now needs them to oversee the referendum. Vice President Mahmoud Mekky said on Sunday he was confident the judges would perform that role, though Mursi's critics in the judiciary may call for a boycott.

While the Islamists' critics, including representatives of the Christian minority, have accused the Brotherhood of trying to hijack the constitution, investors appear to have seen Mursi's moves as a harbinger of stability. They were also relieved that Saturday's mass Islamist protest went off calmly.

The main stock market index, which lost a tenth of its value in response to Mursi's November 22 decree, rallied more than 2 percent when the market opened on Sunday.

"The events that took place through the weekend, from the approval of the final draft of the constitution and the president calling a referendum, gave some confidence to investors that political stability is on track," said Mohamed Radwan of Pharos Securities, an Egyptian brokerage.

But the political opposition, made up of leftist, liberal and socialist parties, have been infuriated by what they see as the Brotherhood's attempt to ram through a constitution that does not enjoy national consensus.

Mursi's opponents warn of deeper polarization ahead.

"LET EVERYONE HAVE THEIR SAY"

Leading opposition figure Mohamed ElBaradei said on Twitter that the "struggle will continue" over a draft constitution that "undermines basic freedoms".

Liberal figures, including former Arab League chief Amr Moussa, pulled out of the constituent assembly last month, as did Christian representatives.

The draft constitution contains Islamist-flavored language which opponents say could be used to whittle away human rights and stifle criticism. It forbids blasphemy and "insults to any person", does not explicitly uphold women's rights and demands respect for "religion, traditions and family values".

The New York-based Human Rights Watch said it protected some rights while undermining others.

The text limits presidents to two four-year terms, requires parliamentary approval for their choice of prime minister, and introduces some civilian oversight of the military - although not enough for critics. Mubarak ruled for three decades.

Mursi described it as a constitution that fulfilled the goals of the January 25, 2011 revolution that ended Mubarak's rule. "Let everyone - those who agree and those who disagree - go to the referendum to have their say," he said.

The Islamists are gambling that they will be able to secure a "yes" vote by mobilizing their core support base and many other Egyptians keen for an end to two years of turmoil that has taken a heavy toll on the economy.

Nafaa of Cairo University said the constitution would likely be approved by a slim majority. "But in this case, how can you run a country with a disputed constitution - a constitution not adopted by consensus?" he asked.

(Writing by Tom Perry; Editing by Alistair Lyon)

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NATO aims to repair Russia ties despite Patriot row

BRUSSELS (Reuters) - NATO foreign ministers, meeting for the first time this week since Russia appointed a new ambassador to the military alliance, are hoping to improve ties with Moscow despite a fresh row over plans to send anti-aircraft missiles to Turkey.

A NATO spokeswoman said the meeting aimed to "re-energize" relations with Russia - whose cooperation is needed both on ending the conflict in Syria and smoothing the withdrawal of most foreign combat troops from Afghanistan by the end of 2014.

The twice-yearly meeting on Tuesday and Wednesday will also discuss funding for Afghanistan forces after 2014, and will be preceded by a visit to NATO headquarters in Brussels by Pakistan Foreign Minister Hina Rabbani Khar.

Russia appointed a new ambassador to NATO in October after a 10-month gap, raising hopes for an improvement in ties, strained by U.S. and NATO plans to construct a missile shield around Europe as well as last year's NATO bombing campaign in Libya.

NATO and Russia have, however, have been at odds over how to end the 20-month revolt in Syria. Russia has vetoed U.N. Security Council resolutions aimed at increasing pressure on Syrian President Bashar al-Assad to step down.

Russian Foreign Minister Sergei Lavrov, who meets NATO ministers including U.S. Secretary of State Hillary Clinton on Tuesday, is expected to raise concerns over plans to deploy Patriot surface-to-air missiles on NATO member Turkey's border with Syria.

"We will tell them (the Russians) ... that this is defensive and not there to establish a no-fly zone," a senior NATO official, speaking on condition of anonymity, said.

The NATO meeting coincides with a visit by Russian President Vladimir Putin to Turkey, where he is expected to face fresh calls to help bring an end to the war in Syria.

AFGHAN WITHDRAWAL

The NATO meeting will also discuss how some $4.1 billion of annual foreign funding for Afghanistan's security forces will be managed after 2014.

The Afghan government wants to handle its own finances but with Western concerns over corruption running high, it is likely NATO will have a strong role in managing international funding, NATO diplomats said.

Afghan Foreign Minister Zalmai Rassoul will join the Afghan part of the talks.

Western domestic pressure is rising to end the Afghan war where fighting shows little sign of easing - on Sunday militants attacked on a U.S.-Afghan airbase in eastern Afghanistan [ID:nL4N09C010].

Pakistan, whose help is seen as needed to reach a political settlement to the war, has begun to release some Taliban prisoners in response to calls from Afghanistan to smooth the way to peace talks.

Meanwhile, little progress is seen at the Brussels talks on the row between NATO and Russia over Washington's plans for the missile shield, due to be completed in four phases by roughly 2020, to counter a potential threat from Iran.

Moscow says the system will undermine its nuclear deterrent by making its missiles vulnerable.

The senior NATO official said it was too early to expect any new initiative. "I think you still need to give it a little time ... On BMD (ballistic missile defense), we will need a new momentum," he said.

(Editing by Myra MacDonald)

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Syrian army pounds rebel strongholds around capital

BEIRUT (Reuters) - Syrian army forces pounded rebel-held suburbs around Damascus with fighter jets and rockets on Sunday, activists said, killing at least ten and wounding dozens in an offensive to stop rebels closing in on the capital.

Rebels planned to push into the city center from their strongholds on the outskirts and fighting has been fierce. The army sent reinforcements after a week of rebel advances, including the capture of two military bases near the capital.

Activists said the heavy rocket attacks on Sunday killed at least ten in the town of Deir al-Asafir, 12 km east of Damascus. Video published by activists from the town showed at least five bodies, one of them a young boy and one an elderly man. The other bodies were wrapped in blood spattered white sheets.

Another video showed smoke rising over the skyline and some buildings in flames. Opposition reports are difficult to verify because the government restricts media access in Syria.

Syria's 20-month-old uprising has grown increasingly bloody in recent months, and activists say more than 40,000 have died. More than 200 people were killed on Saturday according to the opposition-linked Syrian Observatory for Human Rights, with at least 43 dead around Damascus and its suburbs.

Syrian security sources and diplomatic contacts told Reuters that Assad's forces launched an offensive this week in a move to seal central Damascus off from the suburbs.

The army's assault appears to have staved off a rebel advance into central Damascus so far. But neither side has gained ground in recent days, and fighting continues along the outskirts of the city despite heavy shelling by Assad's forces.

Clashes around Damascus International Airport went into their fourth day on Sunday. It has effectively been closed since Thursday when the army tried to push back rebels there who say the entire airport road had become a battleground.

"The Free Syrian Army is striking the reinforcements trying to enter the airport to help the regime's forces...there are clashes all along the airport road," said Abu Nidal, a rebel spokesman in Damascus, speaking by Skype.

Rebels say they want to control the airport because the army has used it to bring in weapons. Western intelligence reports earlier this year said that Iran, Assad's main backer, had been using civilian aircraft to fly military equipment and personnel through Iraqi airspace into Syria.

American officials say that arms flow has continued due to Iraqi reluctance to check flights, according to a New York Times article. It said only two inspections had occurred since Iraq agreed to a U.S. request in September and that Iran may have been tipped off about the searches.

Prime Minister Nuri al-Maliki told reporters in a press conference in Baghdad that there was no such request.

"There is no ability to inspect all planes destined to Syria and there was no U.S. request to inspect all aircrafts because they know that this is not possible," he said on Sunday.

"We said to the Syrians, Iranians, U.S, UN and the world, we said as the Iraqi Government, we are committed to (prevent) the weapon ... We prevent the passage of arms for you because our constitution states that Iraq is not a pathway or a seat for any similar actions".

CAR BOMBS

In Syria's central city of Homs, a car bomb killed at least 15 people and wounded 24 on Sunday, Syria's state news agency SANA said. It said the blast in the city's Hamra district also damaged many nearby residential buildings.

There has been a rise in the number of car bombs around the country. The British-based Observatory, which has a network of activists across Syria, reported four car bombs on Saturday.

Violence has risen in Syria particularly since rebels began to contest Assad's control around the capital and Syria's largest city Aleppo, but foreign powers remain deadlocked.

Western countries support the opposition but Russia, Syria's main arms supplier, and China have blocked three U.N. Security Council resolutions condemning Assad and reject sanctions on his government.

Assad, whose family has ruled Syria for four decades, says he is fighting off radical Islamist militants funded by the West and Gulf Arab countries.

State television on Sunday said the army had been "eliminating al Qaeda terrorists" in several suburbs surrounding Damascus including the rebel stronghold of Daraya.

The army entered part of Daraya, rebels said, a suburb on the southern outskirts of Damascus where fighters have launched mortars into the city. Rebel spokesman Abu Nidal said the army had entered one side of the town but that rebels were still in control of the rest of the area and were fighting back.

The army was firing heavy artillery and rockets into the town, rebels said.

(Editing by Anna Willard)

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Netanyahu brushes off world condemnation of settlement plans

JERUSALEM (Reuters) - Prime Minister Benjamin Netanyahu on Sunday brushed off world condemnation of Israel's plans to expand Jewish settlements after the Palestinians won de facto U.N. recognition of statehood.

"We will carry on building in Jerusalem and in all the places that are on the map of Israel's strategic interests," a defiant Netanyahu said at the weekly cabinet meeting.

In another blow to the Palestinian Authority (PA) in the West Bank, Israel also announced it was withholding Palestinian tax revenues this month worth about $100 million because of a $200 million PA debt to the Israeli Electric Corporation.

Yasser Abed Rabbo, a senior Palestinian official, said confiscation of the funds due the cash-strapped Authority and vital to meeting its payroll, was "piracy and theft".

Stung by the U.N. General Assembly's upgrading on Thursday of the Palestinians' status from "observer entity" to "non-member state", Israel said on Friday it would build 3,000 more settler homes in the West Bank and East Jerusalem, areas Palestinians want for a future state, along with Gaza.

An Israeli official said the government also ordered "preliminary zoning and planning work" for thousands of housing units in areas including the so-called "E1" zone near Jerusalem.

Such construction could divide the West Bank in two and further dim Palestinian hopes, backed by the United States and other international sponsors of the Middle East peace process, for a contiguous country.

But Israeli officials said it could up to two years before any building begins in E1.

At the cabinet meeting, Netanyahu said the "unilateral step the Palestinians took at the U.N. is a gross violation of previous agreements signed with Israel". The government of Israel, he added, "rejects the General Assembly's vote".

The upgrade, approved overwhelmingly, fell short of full U.N. membership, which only the Security Council can grant. But it has significant legal implications because it could allow the Palestinians access to the International Criminal Court where they could file complaints against Israel.

Israel's settlement plans, widely seen as retaliation for the Palestinians' U.N. bid, have drawn strong international condemnation from the United States, France, Britain and the European Union.

"The recognition of Palestine as a state changes a lot of the facts, and aims to establish new ones," Palestinian President Mahmoud Abbas told a cheering crowd in the West Bank city of Ramallah on his return from the United States.

"But we have to recognize that our victory provoked the powers of settlement, war and occupation."

INTERNATIONAL CRITICISM

Netanyahu heads a pro-settler government and opinion polls predict his Likud party will come out on top in Israel's January 22 parliamentary election, despite opponents' allegations that his policies have deepened Israeli diplomatic isolation.

"All settlement construction is illegal under international law and constitutes an obstacle to peace," the EU's foreign policy chief Catherine Ashton said in a statement on Sunday.

The United States said the plan was counterproductive to any resumption of direct peace talks, stalled for two years in a dispute over settlement expansion in the West Bank and East Jerusalem, both captured by Israel in a 1967 war.

Netanyahu says Israel, as a Jewish state, has a historic claim to land in the West Bank and to all of Jerusalem. Palestinians want East Jerusalem as the capital of a future state. Israel considers all of the holy city as its capital, a claim that is not recognized internationally.

Israeli Housing Minister Ariel Attias said that within weeks the government would publish invitations for bids from contractors to build 1,000 homes in East Jerusalem and more than 1,000 in West Bank settlement blocs.

"E1 is in planning, which means sketches on paper," Attias told Army Radio. "No one will build until it is clear what will be done there."

The E1 zone is considered especially sensitive. Israel froze much of its activities in E1 under pressure from former U.S. President George W. Bush and the area has been under the scrutiny of his successor Barack Obama.

Benny Kashriel, mayor of the Maale Adumim settlement adjacent to E1, told Army Radio building "will take a year or two".

Yariv Oppenheimer, head of the Israeli anti-settlement group Peace Now said: "If we build in E1 the two-state vision will truly be history ... it is a strategic point that if built, will prevent the Palestinians from having a normal state."

Approximately 500,000 Israelis and 2.5 million Palestinians live in the West Bank and East Jerusalem.

(Additional reporting by Jihan Abdalla and Ali Sawafta in Ramallah; Editing by Jeffrey Heller and Andrew Roche)

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Protests in Tunisian town show anger at Islamist government

SILIANA, Tunisia (Reuters) - In a remote town in Tunisia's interior, protesters angry over joblessness and harsh police tactics call for the downfall of new Islamist rulers, echoing the revolt that ignited the Arab Spring two years ago.

Siliana, 140 km (90 miles) from the coastal capital, has been convulsed as thousands of largely unemployed youth battle riot police firing tear gas and birdshot.

"I lost my eye because of the police, this is what Ennahda has done," says Anis Omrani, 24, referring to the Islamist party that won the North African country's first free elections last year after the overthrow of dictator Zine al-Abidine Ben Ali.

"We don't have jobs and we're marginalized, but they attack us savagely ... The police of Ennahda just add another problem," Omrani says, with a patch over one eye.

Of at least 252 wounded, medical sources say 17 have been blinded through police use of birdshot, and U.N. Human Rights Commissioner Navi Pillay condemned the government on Friday for what she called excessive violence.

"You may have taken away our eyes but you can't take away our voice!" reads a slogan daubed in red paint on a wall.

"The people want another revolution" and "Ennahda, go away! Game over!" say others.

The revolutionary graffiti recall Sidi Bouzid, the deprived town to the south where a street peddler burned himself to death two years ago in despair at the confiscation of his fruit cart.

His suicide provided the spark for an uprising in Tunisia that spread to Egypt, Libya, Yemen, Syria and Bahrain.

Aware of comparisons between Siliana and Sidi Bouzid, the government temporarily removed the local governor on Saturday and promised jobs to victims of the 2010 uprising. Police stopped using birdshot.

"Siliana will be the second Sidi Bouzid, we're going to get rid of these Islamists who know nothing of Islam," Omrani said.

Ennahda was late to respond to the protests, after first accusing leftists who lost last year's elections of fomenting the unrest by provoking Tunisians in impoverished areas into confrontations that would drive away foreign investors.

The protests began on Tuesday after a call by the leftist labor union UGTT to take to the streets to demand jobs, investment and the removal of Ennahda's Islamist governor.

GOVERNMENT WRONG-FOOTED

The shift to slogans against the Islamists has seemed to wrong-foot the government, which has been absorbed with violent disputes between conservative Salafi Islamists and liberals over the future direction of a once staunchly secular state.

The protests are the fiercest since Salafis attacked the U.S. embassy in Tunis in September over an anti-Islam film made in California, in violence that left four people dead.

They also mirror conflict in Egypt, where secularists have mobilized in recent weeks against post-Arab Spring Islamist rulers whom they accuse of doing little to reform security policies and treating non-Islamists with disdain.

Leftist opponents of Ennahda have been a clear presence on the ground in Siliana, though most protesters seemed to be apolitical youth angry over their economic prospects.

"The government is reproducing the behavior of Ben Ali's regime," said Iyad Dahmani from the center-left Republican Party.

"It's an arrogant government that thinks its election victory means it can use tear gas and birdshot on people instead of giving them jobs and investment."

The Western-backed government secured international funding last week for an economy suffering from the financial crisis in the European Union, Tunisia's main trading partner.

Clashes broke out again on Saturday between around 3,000 people throwing stones and security forces firing tear gas and live rounds into the air from inside armored vehicles.

Young men gathered outside the local branch of the UGTT, chanting the revolutionary songs of Sheikh Imam, a famed leftist cleric in 1970s Egypt.

One protester, a teacher who did not wish to be named, said she had voted for Ennahda last year but felt the Islamists had let people down.

"This is the paradise of Ennahda that we elected," she said, grasping an empty tear gas canister. "This is what Ennahda has to offer us. We won't make this mistake again."

(Writing by Andrew Hammond; editing by Andrew Roche)

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Disabled protest in Spain over austerity measures

MADRID (Reuters) - Thousands of disabled people and their families marched in Madrid on Sunday against benefit cuts, joining Spain's swelling protest movement over austerity measures.

Many were in wheelchairs. They carried signs saying "SOS" and chanted "Disabled people, abandoned" as they made their way through the center of the capital.

The ruling center-right government has introduced more than 60 billion euros' ($78 billion) worth of spending cuts since it took power at the end of last year, which have reduced payouts to Spain's four million disabled people.

"This is a historic day. Disabled people have never taken to the streets before. We're out here now and we're not going back," said Luis Cayo, president of Spain's Committee of Representatives of People with Disabilities.

Protests are held almost daily. Groups including teachers, miners, health workers and students have organized demonstrations against austerity, sometimes attracting hundreds of thousands of people.

Healthcare workers in Madrid went on strike for two days last week and some doctors in the region are on strike for an undefined period.

"The cuts are condemning us to social exclusion. This isn't the only thing we need to do but it's a good start," said Monica, 39, who was in a wheelchair and had traveled to Madrid from the northern region of Galicia to attend the protest.

The government is struggling to meet deficit targets and to try to stave off a bailout. Spain received up to 100 billion euros in aid for its stricken financial sector in June.

Matilde Gomez, who is blind, said disabled people should not be last in line for help. "We are willing to take some cuts but not to this extent," she said.

Spain's Prime Minister Mariano Rajoy said in an interview published on Sunday he could not rule out more cuts. He admitted reaching a European Union-agreed deficit target of 6.3 percent would be difficult, even with the announced cuts.

"The people have to fight and today we have been united," said Maria Agudo, 60, pushing a woman in a wheelchair.

"I don't know if it's going to change anything, but at least it might weigh on their conscience."

A survey published on Sunday showed 85 percent of Spaniards have little or no faith in Rajoy, whose government reneged on a campaign promise on Friday when it said it would no longer raise pensions in line with inflation.

(Additional reporting by Silvio Castellanos; Writing by Clare Kane; Editing by Andrew Roche)

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