The Iraqi premier is offering Moqtada Al-Sadr room for manoeuvre. The question is for how long, asks Omayma Abdel-Latif The motives behind the surprising visit of the Iraqi Interim Prime Minister Iyad Allawi to the holy city of Najaf on Sunday could not be clearer. The week-long battle between the US forces and Moqtada Al-Sadr's Al-Mahdi militia was deeply threatening to Allawi's government, throwing his security agenda into total disarray. Fighting broke out last Thursday ending a two-month truce. Heavily guarded by both Iraqi and American police forces, Allawi arrived in Najaf with no specific plan except to order all the armed militia out of the holy city. "We think that those armed should leave the holy sites and the Imam Ali Shrine compound and abide by the law," Allawi said during his one-hour visit. A quick response came from Al- Sadr who, in a press conference on Monday, appeared defiant as he rejected Allawi's statements. "I will not leave Najaf even if the Americans throw a nuclear bomb on it," Al-Sadr is reported to have told his followers. "He [Allawi] called on the muqawma (resistance) to put down their arms and surrender, but this resistance is a natural reaction to occupation; and our country is occupied and therefore the resistance is a must," Al-Sadr added. He nonetheless accepted a 24-hour truce offered by the Najaf Governor Adnan Al-Zurufi and was reported to have submitted an initiative to the Iraqi Interim President Ghazi Al-Yawar to defuse the tension in the holy city. The fate of the initiative remains unclear. The Najaf fighting has shed light on a complicated relationship between Al-Sadr and Allawi, with both parties sending mixed messages to each other. The dire situation in Najaf and the challenges posed by the young Al-Sadr, analysts say, are the toughest thus far. Although Allawi has been keen to co-opt the young Shia leader into the current political process, this has been to no avail. Last month, in a conciliatory sign, Allawi ordered the re-opening of Al-Hawza newspaper, the mouthpiece of the Sadrist movement that was closed down by the US occupation forces last March. He also invited Al-Sadr to participate in the national elections due to take place next January, an invitation which Al-Sadr turned down. The latest episode of violence in Najaf raised questions about the leadership vacuum within Iraqi Shia circles. The tension reached unprecedented levels just as Iraq's grand Ayatollah Ali Al-Sistani was heading to London on a medical trip. The timing of the trip has sparked speculation as it coincided with the intensification of fighting. This led many to suggest that Al- Sistani's absence is more political than personal. This line of argument was supported by unconfirmed reports that disclosed that all four of the Najaf religious marjeyiaa have fled the city. With Al-Sistani in London, Basheer Al-Najafi in Iran, Mohamed Said Al-Hakim in Germany -- also on a medical trip -- and the whereabouts of Isaaq Al-Fayad is not known, the city, for the first time in its history, has been abandoned by its religious authorities. Al-Sadr aides argue that the fighting was sparked when Iraqi security forces raided the house of Al-Sadr in a failed attempt to seize the young Shia leader. The move was based on an arrest warrant issued by the Iraqi Interior Ministry. But in a surprising move, the Iraqi premier denied that his government issued such a warrant against Al-Sadr. According to Iraqi analysts, the fighting in Najaf, which resumed shortly after Allawi left the city, has dealt a death blow to Allawi's efforts to restore stability in the country and rein in armed militia groups. Some even consider it an indication of the failure of the Iraqi premier's security approach. For two months since he came to power, Allawi has been pursuing an aggressive security policy that has yielded few results so far. In a press conference, Allawi even suggested that the militiamen fighting in Najaf might not be Al-Sadr loyalists at all, but "people using his name". "We think these are gangs, and they use his name as cover," he said. "I have been receiving positive messages from Al-Sadr. That is why we don't think the people that are committing the crimes in Najaf and elsewhere are his people." Allawi's suggestion was viewed as a move to provide an alternative to an all-out showdown with potentially grim implications for both men. One Iraqi observer said that Allawi has been working to avoid a showdown with Al-Sadr so as not to be accused of "shedding Shia blood". But Al-Sadr's aides accuse Allawi of caving in to US pressure to corner Al-Sadr and disband his resistance, and that the US military strikes against Al-Mahdi army have been orchestrated with Allawi's government. Shortly before his visit, Allawi signed a long- awaited amnesty law that pardons Iraqis who have committed minor crimes against US or Iraqi officials. The law, however, will not include those who have killed US soldiers. The signing of the law was seen as yet another move by Allawi to contain a perilous security situation. However, few doubt that the law will have a radical effect on the deteriorating situation in the holy city. The terms of the amnesty cover only relatively minor actions -- among them, possessing illegal arms and explosives, failing to disclose information about terrorist groups and otherwise helping with attacks. Allawi said that Al-Mahdi militia would qualify for the limited 30-day amnesty.