GULF WATCH: Day 160 : A Daily Briefing Paper on Developments in the Crisis

Diplomatic Front: Secretary of State James A. Baker III and Iraqi Foreign Minister Tarik Aziz arrived in Geneva for discussions expected to begin this morning. Baker said he is “hopeful” about the session but warned that the U.S.-led alliance will accept nothing short of unconditional Iraqi withdrawal from Kuwait by Jan. 15.

President Bush, in a TV address, called Baker’s mission “perhaps the final chance” to resolve the conflict without war.

Before arriving in Geneva, Baker met allies in France, Germany and Italy. France’s foreign minister reiterated support for linking an Iraqi pullout with a Mideast peace conference.

Congressional Front: Bush asked Congress in a letter to approve a resolution echoing the U.N. Security Council authorization for use of “all necessary means” to force Iraq to withdraw from Kuwait.

Military Front: A phased air and ground assault on Iraqi forces would result in the deaths of 500 to 1,000 American soldiers, according to an estimate by House Armed Services Committee Chairman Les Aspin (D-Wis.). He said a military offensive will be “a reasonable option” if diplomatic efforts fail to drive Iraq from Kuwait.

American and Spanish warships assigned to enforce the embargo against Iraq boarded and diverted a Soviet cargo ship headed for Jordan carrying military hardware not properly listed on the manifest, a U.S. Navy spokesman said.

Saudi Arabia’s defense minister denied reports that six Iraqi helicopter pilots had defected on Monday night, contradicting reports originally attributed to Saudi officials. The Pentagon said Tuesday that it was unable to confirm or deny the initial account of the incident.

Terrorism Front: Citing “unsettled conditions,” the State Department urged Americans to leave Pakistan. The government also protested the release of five Palestinian terrorists from a Sudan prison.

Latest Gulf Deployment Figures: U.S. troops: 360,000; allied troops: 245,000; Iraqi troops: 540,000.