Heavy fighting as Israel pushes into Lebanon

BEIRUT, Aug 1 (Reuters) Israeli forces today thrust into southern Lebanon and pounded towns and villages, meeting fierce resistance from Hizbollah guerrillas who reportedly killed three soldiers.

Three weeks after the war erupted when Hizbollah snatched two Israeli soldiers in a cross-border raid, Israel's security cabinet agreed to step up its offensive, entailing a ground sweep 6-7 KM into Lebanon, a political source said.

Israel also said it would resume full air strikes in Lebanon early tomorrow at the end of a partial, 48-hour suspension.

European Union foreign ministers called for an immediate end to hostilities, watering down demands for an immediate ceasefire at the insistence of Britain and other close U S allies.

A joint statement adopted at a rare August crisis meeting of the 25-nation bloc said: ''The Council calls for an immediate end to hostilities to be followed by a sustainable ceasefire.'' Israel's army said it had warned residents north of Lebanon's Litani river to leave the area, suggesting air raids could target areas further north than most previous strikes.

At least 617 people, mostly civilians, have been killed in Lebanon. The health minister put the toll at 750 including bodies buried under rubble. Fifty-one Israelis have been killed.

The southern Lebanese village of Qana mourned the deaths of at least 54 civilians, including 37 children, killed in an Israeli air strike on Sunday that sparked global outrage and fuelled international calls for a ceasefire.

''All those killed had no shrapnel or wounds on their bodies.

They all died of suffocation. The debris fell on them -- their colour was blue,'' said Red Cross volunteer Bassam Mokdad. ''If I had been able to arrive earlier, I could've found people alive.'' HEAVY FIGHTING Israeli artillery shells crashed down on the border area around the Lebanese village of Aita al-Shaab, where Hizbollah said it had destroyed a tank in battles with Israeli troops.

Al Arabiya television said three Israeli soldiers died there, which would be the first army fatalities since Israel lost nine soldiers on July 26. Hizbollah said it had inflicted 35 casualties in house-to-house battles at Aita al-Shaab.

Israel's justice minister said about 300 of an estimated 2,000 Hizbollah fighters have been killed in three weeks of fighting, and the tourism minister later said 400 had been killed. Hizbollah, which says it does not hide its dead, has announced 43 deaths in that period.

The intense fighting came the same day as Israel's security cabinet gave the green light to an expansion of its military operations in southern Lebanon, where troops are now on the ground in at least four separate areas.

''I reckon the time required for the (army) to complete the job, and by that I mean that the area in which we want the international force to deploy is cleansed of Hizbollah, will take around 10 days to two weeks,'' Infrastructure Minister Binyamin Ben-Eliezer told Army Radio.

Israel wants to push Hizbollah back and stop it blasting rockets over the border. However an Israeli minister said there was no way its forces could destroy all the missiles, comments apparently aimed at lowering Israeli public expectations.

Israel has rejected calls for a truce as world powers differ over the urgency of halting the war.

Most Arab and European governments have insisted on an immediate end to fighting but Israel's closest ally, Washington, has said any ceasefire must be part of a broader deal that ends the threat to the Jewish state from Hizbollah.

The United Nations has postponed discussion on mobilising an international force for Lebanon until at least Thursday, to wait for more progress towards a political solution.

France, which has been tipped to lead the new force, said it must be bigger than the 10,000 troops suggested by U N Secretary-General Kofi Annan, be sufficiently well armed and have precise guidelines when it comes to opening fire.

Israeli aircraft bombed eastern Lebanon near Syria on the second day of what it had said would be a 48-hour partial halt to air strikes, Lebanese security sources and witnesses said.

The raids were aimed at ''preventing the transferring of weaponry'' to Hizbollah, the army said. Israel had said it would use air strikes against Hizbollah and to back ground forces.

The United Nations was forced to scrap two aid convoys planned for villages close to Lebanon's southern border because it could not get security clearance from Israel.

REUTERS SBA RN2339