Smash hit

One of the men had his head swathed in bandages and appeared to have bloodstains on his top. The other, who apparently had blood smeared on his trousers, had plasters on his head.

Ismail al-Waili, head of Basra's Security Committee, told the Associated Press that once news of the gun battle spread, British soldiers surrounded the city's Felony Crimes Department where men were being held and a crowd quickly gathered.

Reports and television pictures showed the crowd pelting the British vehicles with stones and petrol bombs and setting an armoured vehicle on fire. Witnesses said that two Iraqi civilians were killed in the clashes and 15 people were injured.

During the melee one soldier could be seen scrambling for his life from a burning tank and the rock-throwing mob. The Ministry of Defence tonight refused to comment on the break-out, although it was confirmed by the British Embassy in Baghdad.

Today’s violence will inevitably make life more complicated for coalition forces in Basra and around Iraq.

Sir Menzies Campbell, the Liberal Democrat Foreign Affairs spokesman, said from the party conference in Blackpool: "It is hard to see how relations between the British military and the civilian Iraqi authorities in Basra will ever be the same again.

"This is bound to be seen as a humiliation by many Iraqis - something the insurgents will use to their advantage. An operation of this kind must have gone to the highest level - "I would be surprised if the Prime Minister had not been consulted."

The security situation in Basra has been gradually worsening in recent months. On Sunday, about 200 members of the al-Mahdi Army, a militia group headed by the radical Shia cleric Hojatoleslam Moqtada al-Sadr, staged a show of force in the city, blocking roads in the city centre and demanding the release of their local commander who had been arrested by British and Iraqi security forces.

After a tense stand-off lasting several hours, the militiamen withdrew when an al-Sadr representative arrived to negotiate with police and the British forces.

Today's unrest comes less than two weeks after two British soldiers and three western security guards were killed by separate roadside bombs in and around Basra. On July 16, a roadside bomb in nearby Amarah killed three British soldiers and wounded two others.

And in a sign of the further deterioration of order in the city, an Iraqi journalist working for The New York Times was found dead today.

Fakher Haider, who had worked for the newspaper for two and a half years, was found with his hands bound and a single bullet wound to the head, a doctor in the forensic department of Basra’s hospital told Reuters, speaking on condition of anonymity.

Haider is the second journalist to be kidnapped and killed in Basra in the past two months. Steven Vincent, an American freelance reporter who was writing a book about the city and who had written an opinion piece for The New York Times criticising the Basra security forces, was kidnapped and found shot dead in August.

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