Panic demands end to takeover

MILAN PANIC, the Yugoslav Prime Minister, was battling yesterday to restore his authority, after the humiliating seizure of the federal Interior Ministry by police loyal to the Serbian President, Slobodan Milosevic.

The minister in question, Pavle Bulatovic, who has been barred since Monday from entering his office by Serbian police at the doorway, yesterday moved his belongings with as much dignity as he could salvage to Mr Panic's headquarters, in the sumptuous Palace of the Federation.

The seizure of the buildings suggested that the struggle between Mr Panic and Mr Milosevic for the control of Serbia is entering a crucial phase. It appeared to be timed to scupper the peace talks in Geneva between the federal government and Croatian and Bosnian leaders, which Mr Milosevic and fellow Serbian

hardliners oppose.

Both sides in the Serbian power struggle are now awaiting a decisive move from the President of Yugoslavia, Dobrica Cosic, the commander-in-chief of the armed forces. Mr Cosic was expected to return from the Geneva peace talks last night, where he is reported to have tried in vain to reach Mr Milosevic by telephone.

Federal officials were yesterday trying to limit the damage done to Mr Panic's reputation, by feverish media speculation claiming that Mr Milosevic had successfully carried out the first stage of a coup d'etat. The officials revealed that Mr Panic was in regular contact with General Zivota Panic, the head of the armed forces, during the last 48 hours, and that he will spend an entire day this week at the Defence Ministry, where he is expected to try to rally the army top brass behind the federal government, in the event of another confrontation.

Western diplomats said Mr Panic had given the Serbian police a time limit to evacuate the Interior Ministry, but added that they did not believe Mr Panic was in a position to enforce a deadline.

If it comes to a final show of force, the odds are stacked in favour of Mr Milosevic. The President of Serbia has a powerful force of more than 40,000 well- armed police at his disposal, including specially trained regiments. He can also call on 3,000 reservists and more than 10,000 paramilitary police from Krajina, the Serb-controlled enclave in Croatia. This force could easily crush the 1,000 federal police.

In the last resort, the only weapons in the armoury of the federal government are a rather superficial popularity and the dubious support of the federal army. The loyalty of Gen Panic is not in question. But the officer class is so notoriously riven by internal splits between moderates and hardline supporters of Mr Milosevic that the army is a dangerous card to rely on. The army's track record in Slovenia and Croatia suggests a force that cannot act cohesively.

With Serbian police manning the exits to the Interior Ministry and the Serbian government insisting that nothing untoward has taken place, the motive for the attack remained unclear. 'Is this the start of a coup, or just showing who is boss?' asked the Belgrade newspaper, Borba, in an editorial.

The newspaper suggested the attack was motivated by a desire to get hold of ministry files which shed light on war crimes committed in Bosnia and Croatia, and which incriminate pro-Milosevic officials. A pointer in this direction was that the commander of the operation was Mihaly Kertes, a close ally of Mr Milosevic, who was fired from the federal government by Mr Panic on charges of organising 'ethnic cleansing'.

Mr Milosevic may decide to go no further. He has made his point, which is to cut Mr Panic down to size and show that he controls the Serbian agenda.

GENEVA - Yugoslavia and Croatia will set up liaison offices in their respective capitals in an effort to normalise their relations, the presidents of the two countries agreed here yesterday, AFP reports.