Karbala: Hundreds of thousands of Shiite pilgrims gathered in the sacred Iraqi city of Karbala yesterday for a religious event held under tight security as a top politician said Iraq was already in a sectarian civil war.

In Baghdad, Shiite, Sunni and Kurdish leaders were still struggling to form a national unity government more than three months after elections, raising fears that a political vacuum will play into the hands of insurgents and fuel violence.

In Tehran, an Iranian government official said: "We have agreed to start talks with America on Iraq. Particularly on the timetable for departure of occupying forces."

Former prime minister Eyad Allawi was pessimistic about the future, saying Iraq was nearing the "point of no return" on a path toward all-out military conflict.

Allawi, a secular Shiite appointed under US supervision in 2004 and whose major offensives against both Shiite and Sunni guerrillas failed to halt insurgencies, warned that Iraq had already plunged into sectarian civil war.

Allawi, a secular Shiite appointed under US supervision in 2004 and whose major offensives against both Shi'ite and Sunni guerrillas failed to halt insurgencies, warned that Iraq had already plunged into sectarian civil war.

"It is unfortunate that we are in civil war. We are losing each day an average 50 to 60 people throughout the country, if not more. If this is not civil war, then God knows what civil war is," he told BBC television yesterday.

Aside from a mortar that landed near a garage and caused no casualties, the event, which centres today evening, was calm.

Wary that an attack on the Shiite pilgrims could unleash a new wave of bloody reprisals, the Karbala authorities deployed at least 8,000 Iraqi police and soldiers in the city.

Local officials say they expect as many as 2 million people to attend the mourning ritual today evening in Karbala, 110 km southwest of Baghdad.

A US military statement said more than 60 suspected insurgents had been captured in Operation Swarmer near Samarra, north of Baghdad.

In an unrelated operation, US troops killed eight people, including a family, after their patrol was ambushed in a nearby town early yesterday, Iraqi police said.