WRAPUP 3-UN concerned about Sri Lanka civilian casualties

* Sri Lanka block on Swedish minister visit criticised

* U.N. says government weapons pledge must be respected

* Military says 28 rebels die in civilian rescue operation

By Ranga Sirilal

COLOMBO, April 28 (Reuters) - The United Nations on Tuesday expressed concern to Sri Lanka over casualties among civilians trapped with rebels, and the European Union criticised Colombo for excluding a Swedish minister from an EU mission.

Sweden recalled its ambassador to Sri Lanka after Foreign Minister Carl Bildt was barred from participating in a mission there with French and British colleagues this week, Bildt said on the sidelines of EU foreign ministers' talks Luxembourg.

The mission's aim is to press EU calls for a humanitarian ceasefire in the war between the government and Tamil Tiger (LTTE) rebels, in an effort to protect tens of thousands of civilians trapped by the fighting.

Czech Foreign Minister Karel Schwarzenberg, representing the Czech EU presidency, said the Sri Lanka move was "a grave mistake ... which will of course have repercussions in Europe and will influence the further development of relations between the Sri Lankan government and the European states".

Europe is an important trade partner and foreign aid source for Sri Lanka.

Sri Lankan Foreign Secretary Palitha Kohona told Reuters: "We have not rejected the Swedish foreign minister. He has been invited to come here next week because we are just overwhelmed at the moment with all these visitors."

"Mature governments and institutions should not deal with each other based (on) threats," he added.

The Foreign Ministry also said in a statement that the allegation is baseless, as there was no formal application received for a visa by the Sri Lankan Embassy in Stockholm.

"The Government of Sri Lanka envisages the visits of the French and the British foreign ministers purely on a bilateral basis and not in terms of their membership in a regional or United Nations context," the statement added.

"Further it was found to be rather unwieldy to facilitate three foreign ministers at one given time at such short notice."

Sri Lanka also said it is extremely regrettable that it is being wrongly accused of preventing the visit by stating that it would be interpreted as a challenge to the dialogue with the EU and consequences will follow bilaterally and multilaterally.

"The statements made in this regard seem to be emanating from a unilateral decision made on the part of Sweden and the EU with regard to the said visit," the statement added.

One of the visitors Sri Lanka has been dealing with is U.N. Under-Secretary-General for Humanitarian Affairs John Holmes, who met with President Mahinda Rajapaksa on Tuesday and expressed the world body's concern over the civilians trapped in the last pocket of LTTE resistance to government forces.

Sri Lanka this week ordered troops to stop using heavy weapons against the LTTE.

The military says it has deployed special forces, commandos and snipers using only small arms in what is now an operation aimed only at freeing civilians. But in a sign battles were still raging the army said on Tuesday it had recovered the bodies of 28 rebels killed the previous day.

GREAT CONCERN

A U.N. statement said while Holmes "welcomed the government's announcement about the scaling down of combat operations ... the key was implementation in full of what had been announced."

It quoted Holmes as saying the pledge must be respected to protect civilians, adding that he "expressed great concern at initial reports of continued shelling".

Holmes had earlier inspected refugee camps near the war zone as part of a two-day visit.

S. Puleedevan, head of the LTTE Peace Secretariat, told Reuters by telephone on Tuesday the government had conducted shelling with heavy weapons and killed 75 civilians, charges the military denied.

Checking claims from the battle zone, where 50,000 troops surround an estimated few hundred to few thousand remaining rebel fighters and tens of thousands of civilians, is difficult given lack of access and of independent sources on the ground.

The rebels have vowed no surrender in their fight for a separate state for Sri Lanka's Tamil minority, a struggle that began in the early 1970s and erupted into civil war in 1983.

The conventional war's end would still leave Sri Lanka facing the challenges of healing years of division and boosting an economy beset by a declining currency, falling exports of tea and garments and low foreign exchange reserves.

It is seeking a $1.9 billion International Monetary Fund loan and business executives are optimistic the war's end will bring foreign investment back, but the LTTE has warned it will stage guerrilla attacks on economic targets.

The military consistently denied accusations from the LTTE, United Nations and others it shelled civilians. The Tigers deny accusations they are holding the civilians as human shields.

More than 113,000 have fled the battle zone since troops a week ago blew up an earth barricade blocking access, joining at least 72,000 displaced by earlier fighting.

An internal U.N. tally of casualties says nearly 6,500 people have been killed in fighting since late January. The world body estimates over 50,000 remain in "mortal danger".

The government has ruled out a ceasefire, arguing the LTTE uses such breaks to rearm and regroup. (Additional reporting by David Brunnstrom in LUXEMBOURG; Writing by Jerry Norton)