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Muqtada al-Sadr, the Shia leader, has called on Arab countries to support his militia's battle against "US occupation", with clashes between Shia groups and Iraqi government troops entering their fifth day.
The remarks came as Nuri al-Maliki, the Iraqi prime minister, called the Shia militias in the southern city of Basra "worse than al-Qaeda".
More than 200 people have reportedly died since an Iraqi military crackdown in Basra sparked violence across the country.
Al-Maliki, who is personally supervising the operation in Basra, said on Saturday that Iraqi forces would not leave "without restoring security and order".
"We will continue to stand up to these gangs in every inch of Iraq," he said in remarks broadcast on state-owned television on Saturday.
"There are some among us who are worse than al-Qaeda. Al-Qaeda is killing innocents, al-Qaeda is destroying establishments and they [Shia fighters] also," he said.
Later on Saturday, the Baghdad military command extended the curfew in the capital indefinitely, state television Al-Iraqiya said.
The curfew, which was imposed late on Thursday, was to have been lifted on Sunday at 5am (0200 GMT).
Basra operation
The Basra crackdown was aimed at disarming the city's warring Shia militias, including the Mahdi Army of al-Sadr, as well as crushing a number of criminal gangs.
In an exclusive interview with Al Jazeera in Damascus, al-Sadr called on the Arab League, the Organisation of the Islamic Conference and the United Nations to recognise "the Iraqi resistance".
"I appeal to these parties to add legitimacy to the resistance and to stand by, not against, the Iraqi people because the Iraqi people need Arabs as much as they need any other person," he said.
"Iraq is still under occupation and the United States' popularity is reducing every day and every minute in Iraq.
"I call, through Al Jazeera, for the departure of the occupying troops from Iraq as soon as possible."
Disarmament rejected
Meanwhile, fighters loyal to the Shia leader rejected the prime minister's call to disarm.
"Al-Sadr has told us not to surrender our arms except to a state that can throw out the occupation," Haider al-Jabari, a member of the Sadr movement's political bureau, said.
On Thursday al-Maliki said that Basra residents would receive a "reward" if they handed in "heavy and medium-size weapons".
However, in Baghdad an official from al-Sadr's movement said Iraqi soldiers had attempted to hand their weapons over to him.
"We told them they should keep their arms. We gave them a Quran and they went back," Salman al-Afraiji said.
A curfew is in place in the capital amid the violence, with restrictions set to be reviewed by the military command on Sunday.
James Bays, Al Jazeera's correspondent in Baghdad, said on Saturday that missiles were still being fired.
"I heard six mortars or rockets - it's difficult to distinguish between the sound of mortars and Katyusha rockets - land in the Green Zone," he said.
'Hospitals overflowing'
Ahmed, a resident of slum neighbourhood which is home to about two million people, said the situation was deteriorating.
"The hospitals are overflowing with wounded. They can't take any more. Even the medical stores are closed," he told the AFP news agency.
"There is no electricity, no water or fuel. We are afraid of gunbattles. The main markets are also closed."
Qassim Mohammed, a spokesman for Baghdad health directorate, said in Sadr City: "Seventy-five people have been killed and 498 wounded in clashes in Sadr City in the last four days."
He accused American forces of "creating obstacles" in transporting victims of the violence to safety.
In Basra, Iraqi police said that eight civilians were killed and seven wounded in an air raid by US aircraft on a house on Saturday.
The US military said it was looking into the report. Both US and British military aircraft have provided air support to Iraqi forces in southern Iraq.
Fighting has also been reported in the central city of Karbala.
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