Iraqi forces launched their biggest security crackdown since the fall of Saddam Hussein with the start of Operation Lightning yesterday, a sweep by 40,000 Iraqi troops who will seal off Baghdad and hunt for insurgents.

Backed by the 10,000 US troops in the capital, Iraqi soldiers will block major routes into Baghdad and search the city district by district, looking for foreign Arab fighters and Iraqi guerrillas, Iraqi officials say.

The operation comes after a sharp increase in suicide bombings and ambushes by insurgents who have killed around 700 people in the past month since a new Shi?ite Islamist-led government was announced.

At least 70 US troops have been killed in the same period, the highest monthly American death toll since January when insurgents were trying to derail the Jan. 30 elections.

?The operation began today. The troops will block all entrances of Baghdad to prevent terrorists from conducting activities in the capital. It?s a crackdown on the terrorism infrastructure,? a Defence Ministry official told Reuters. The operation was announced on Thursday ? potentially giving insurgents the chance to flee Baghdad before it began.

Iraq?s government has come under pressure from Washington to launch a decisive response to insurgent attacks, to try to restore public confidence sapped by relentless violence and the long delay in forming a cabinet after the elections.

Insurgents kept up their offensive yesterday. In the town of Tuz Khurmatu south of the strategic oil city of Kirkuk, a suicide car bomber blew up his vehicle near an American military convoy, killing at least two Iraqis, police said. Witnesses said some US casualties were evacuated from the scene by helicopter, but the US military had no immediate information on the attack.

In Baghdad, a car bomb exploded at a checkpoint near the Oil Ministry, killing at least two Iraqis, police said. Near the town of Amara in mainly Shi?ite southern Baghdad, insurgents attacked a British military patrol, killing a British soldier, the Ministry of Defence in London said.

?The incident is under investigation but it appears to have been the result of an explosion,? a spokesman said, adding that several soldiers had been wounded.

<B>Drafting of a permanent constitution</B>

The US military announced the deaths of two more servicemen. A Marine was killed on Saturday in a roadside bomb attack on his vehicle in western Iraq, and an American soldier died on Friday after being wounded by a roadside bomb the previous day southwest of Baghdad.

As well as pushing for more decisive security measures, Washington has also been encouraging the Shi?ite and Kurdish blocs that emerged strongest from the January polls to involve more Sunni Arabs in the drafting of a permanent constitution, the next step on Iraq?s path to democracy.

Sunni Arabs dominated Iraq during Saddam?s rule but won only 17 seats in Iraq?s 275-member parliament because many Sunni groups boycotted the elections and violence in Sunni Arab areas meant turnout there was extremely low.

To try to defuse sectarian tensions and undermine an insurgency dominated by Sunni Arab fighters, the government gave several cabinet posts to Sunnis and says it is examining ways to give them a greater role in drafting the constitution.

Only two Sunni Arabs are part of the 55-member committee drafting the constitution but the leaders of the committee say they are discussing how to increase Sunni representation.

<B>Andrew MARSHALL</B>

DENIAL

<B>Al Qaeda?s leader Zarqawi not in Iran</B>

■ Iran denied yesterday a British newspaper report that al Qaeda?s leader in Iraq, Abu Musab al-Zarqawi, had fled to the Islamic republic after being seriously injured in a US missile attack.

Iran?s Foreign Ministry spokesman Hamid Reza Asefi said the report in the ?Sunday Times? newspaper was without foundation. ?This is an unprofessional kind of fabricating news,? Asefi told a weekly news conference. ?Iran is a clear and transparent country, where such covert activities do not take place.?Quoting a senior insurgency commander in Iraq, the ?Sunday Times? said Zarqawi had shrapnel lodged in his chest and may have been moved to Iran. It said his supporters might try to move the Jordanian-born militant to another country for an operation. Zarqawi, accused of masterminding suicide bombings, ambushes and assassinations in Iraq, was wounded three weeks ago when a US missile hit his convoy near the northwestern Iraqi city of al Qaim, the ?Sunday Times? quoted the unnamed source as saying. Washington has offered a $25 million bounty for Zarqawi. The United States has accused Iran of harbouring al Qaeda militants who escaped Afghanistan after US troops invaded in late 2001 following the Sept. 11 attacks. Tehran acknowledges that al Qaeda members have managed to cross its long and hard-to-police borders with Afghanistan and Pakistan. But it denies providing safe-haven to al Qaeda members and has extradited scores of suspected militants who have fled to Iran in the last four years.