Iraq Accepts Cease-Fire Talks : U.S. Wants Quick POW Release, Formal End of War : Diplomacy: Washington plans a U.N. move that could ease some economic sanctions against Baghdad. But the allies expect the arms embargo to continue while Hussein remains.

Iraq accepted President Bush’s terms Thursday for a meeting of military commanders to discuss a full cease-fire, leading Administration officials to hope for a quick release of U.S. prisoners of war and a formal end to the Persian Gulf War.

Release of the POWs is “foremost in my heart,” Bush said in announcing the Iraqi decision. “We expect a prompt repatriation of them.”

Although Iraq has not yet made any commitments on prisoners, the quick response to the U.S. terms for a meeting is a positive sign, a senior White House official said. “If they were choosing not to deal with what we had indicated was very important to us, they wouldn’t have responded that quickly,” the official said.

Saddam Hussein’s forces are known to have captured at least 13 allied POWs, but many more could be in Iraqi hands. The Pentagon lists 45 Americans as missing in action in the war.

Iraq’s ambassador to the United Nations, Abdul Amir Anbari, formally notified the Security Council that his country will comply with all 12 U.N. resolutions directed against it. He told reporters that “as far as the Geneva Convention regarding prisoners of war, Iraq will comply with that.”

The Iraqi diplomat spoke after a private meeting with U.S. Ambassador Thomas R. Pickering. It was the second meeting between the two men in 24 hours.

Although Bush’s order directing allied troops to stop shooting ended most of the fighting, a true cease-fire will not take place until commanders from both sides can meet to arrange disengagement of the armies, exchange of prisoners and related issues.

In Wednesday night’s announcement, Bush asked that the meeting take place within 48 hours, and officials said they believe the talks could take place as early as today.

U.S. officials, meanwhile, prepared a new resolution for the U.N. Security Council designed to create a framework for achieving what State Department spokeswoman Margaret Tutwiler called “the political considerations that have to be addressed for the termination of the war.”

The resolution, likely to be presented today, could relax some economic sanctions against Iraq, particularly those limiting imports of food and medicine, while setting out steps Baghdad must take to end other punitive measures. Those steps are expected to include the release of all POWs and a formal rescission of the Iraqi law that declared Kuwait to be the country’s 19th province, Tutwiler said.

The resolution also will formally end the sanctions against trade with Kuwait that were imposed when Iraq took over the small Persian Gulf state.

Future of Iraq

The fact that Iraq has moved so quickly to accept allied terms for ending the war “indicates they know they are hurting,” said one Administration official. “They see a need to resolve this issue” if the country is to have any hope for rebuilding its war-shattered economy.

Even if Iraq meets all the conditions, however, officials again emphasized that the allies intend to take a hard line--particularly in continuing an arms embargo--as long as Saddam Hussein remains in power.

“It would be much easier to look on Iraq’s problems with some sympathy if (Hussein) were not in power,” White House Press Secretary Marlin Fitzwater said.

French Foreign Minister Roland Dumas sounded a similar note. Future relations between the industrial world and Iraq “will depend very much on whether Saddam Hussein is still in power,” Dumas told French reporters in Washington after meeting with Bush and Secretary of State James A. Baker III.

Western nations must “walk a fine line--avoiding giving oxygen to Saddam Hussein but at the same time avoiding giving the people of Iraq the feeling that we want to punish them,” Dumas said, according to a participant in the meeting.

For allied officials, Thursday was a day for mutual congratulations, illustrated dramatically when Kuwaiti Ambassador Sheik Saud al Nasir al Sabah met with Bush in the Oval Office and told him he would “go down in history as the great liberator of my country.”

“We are deeply grateful to you and our friend the United States for all that you have done, and our hearts go also to the families of the victims that have lost their lives bravely in operation Desert Storm,” Saud said. “Our condolences to them, they have not died in vain.”

Bush, in turn, praised the Kuwaitis and, later in the day, in a meeting with Saudi Ambassador Prince Bandar ibn Sultan, congratulated the Saudi government on its participation in the anti-Iraq coalition.

Gulf Security

Baker plans to visit Saudi Arabia, along with Israel, Syria, Egypt, Turkey and the Soviet Union in a trip likely to begin Wednesday, the State Department announced.

The trip, an Administration official said, is designed to “get the lay of the land” and begin the process of devising new security arrangements for the Gulf region. In addition, Baker aides hope the trip may mark the beginning of a new effort to find peace between Israel and its Arab neighbors.

With attention quickly shifting from prosecuting the war to building the peace, the mood at the White House, said one senior official, was like that of “a team at halftime that is leading by a lot”--a combination of happiness over what has been accomplished plus a feeling that “there’s still another big half that has to be played.”

“There’s no sense of finality,” said Fitzwater. “There’s too much left to be done.”

And with the end of the war, divisions among Iraq’s adversaries once again began to assert themselves.

Dumas, for example, emphasized to reporters France’s concern about resolving the Palestinian issue, a subject that Soviet officials also stressed.

In Israel, by contrast, officials expressed some disappointment that the war had ended with Hussein still in power.

Israeli Deputy Foreign Minister Benjamin Netanyahu, for example, described the allied victory as “glittering” but added, “There must be the destruction of Iraq’s capacity to threaten the region.”

In Israel

Israeli officials, in particular, stressed fears that Iraq may still possess some Scud missile launchers that could once again become a threat.

“We have reason to celebrate. But we have to be careful,” said army spokesman Nachman Shai. “When you ask if the threat is removed, I would say no. But the probability of launches has gone down.”

Israel has officially requested that Iraq’s missile launchers and its cache of rockets and stock of chemical weapons be destroyed as part of the final settlement of the Persian Gulf War, top officials said Thursday.

Foreign Minister David Levy sent letters to Western allied governments, including the United States, asking that international inspectors check on the elimination of Iraq’s missile and chemical arsenal and that Hussein’s army be kept at low strength for the indefinite future.

He also demanded that all arms sales to Iraq be banned and that Baghdad be forced to promise never to attack Israel again. All this is supposed to be agreed to, he said, before U.S. and allied troops leave southern Iraq. Afterwards, Iraq must show itself to be “pointed toward peace” with all the states in the region, including Israel, before the international trade embargo, placed on the Iraqis, is lifted.

War Crimes

Some differences may exist between the Administration and the Kuwaitis on the degree to which Iraqi officials should be pursued for possible war crimes or reparations payments.

The senior White House official said Bush will probably not push ahead with earlier rhetoric about trying to prosecute Hussein for war crimes, at least as long as Hussein releases U.S. POWs in good shape.

The chief purpose of the war crimes talk, he indicated, was to deter Iraq from using chemical weapons or harming POWs. And at least on the chemical weapons front, that approach appears to have succeeded. U.S. military officials say that so far, they have found no evidence of chemical munitions stored in Kuwait.

The Kuwaitis, by contrast, have made clear they intend to prosecute lower-level Iraqi officials for committing atrocities, if the perpetrators can be identified. And Saud made clear that his government has no intention of moderating its demand that Iraq pay reparations.

“I believe the Iraqis are in a position to pay reparations,” Saud told reporters at the White House after meeting Bush. Iraq “is a rich country,” he said. “They have the second-largest oil reserves in the area (after Saudi Arabia).”

In addition, Saud said, Kuwait’s government has been investigating Iraqi funds in banks around the world and has plans to try to lay claim to Iraqi assets currently frozen in the United States and other countries.

The ambassador also urged Iraqis to rise up against Hussein. “Diplomatically and politically, I’m expected to say that we will leave the fate of Saddam Hussein to his people,” Saud said. “But personally, I would say I would encourage the Iraqi people to speed up any action against Saddam Hussein and his party to relieve themselves of this misery that they have been living under for the last 10 years now.”

In Moscow

In Moscow, by contrast, Soviet Foreign Minister Alexander A. Bessmertnykh told reporters that Iraq must remain strong in order to safeguard regional security and that the Soviet Union has no qualms about dealing with Hussein because as far as he can tell, the Iraqi people still support him.

“We are dealing with Iraq, with the Iraqi people and with the leaders that are elected or supported by the people,” he said. “We will accept any decision of the Iraqi people.”

“We are absolutely sure there can be no reliable security system in the region if Iraq does not play a solid role,” Bessmertnykh told reporters.

The “main source of instability, lack of trust and continuing arms race in the region,” Bessmertnykh said, is the continuing Israeli-Palestinian conflict, and he suggested that the Soviets might act as a middleman in an “urgent” effort to find peace there.

“We cannot exclude the possibility that by some paradoxical way, the events in the Gulf will add an additional impulse to look more actively for a solution to one of the oldest and most destabilizing conflicts in the world,” Bessmertnykh said.

The Soviets already appear to be acting as the chief go-between passing messages between Washington and Baghdad, but officials differed about how large a role Moscow was playing in bringing about talks between the two sides.

At the United Nations

At the United Nations, meanwhile, U.S. and British officials made clear they foresee a limited role for the international body as the victorious allies try to shape the future of the Gulf.

“We have to tailor the United Nations role to what it does best,” a senior Administration official said.

The official suggested that the United Nations might be better at border patrol than at overseeing security in the region.

U.S. officials say their chief hope is to increase the role of the Gulf Cooperation Council, a body led by Saudi Arabia and including most of the small, oil-rich nations of the Gulf. But they conceded that the Arab states have been slow to develop plans for any new security system in their region.

India, Yemen and Cuba pressed Thursday for the Security Council to issue a formal resolution on a cease-fire. But U.S. and British officials opposed the move, fearing it would tie the hands of military commanders in case talks with the Iraqis break down.

Nonetheless, Fitzwater and other White House officials made clear that the Administration is convinced that the war is truly over and has no plans to resume fighting against Iraq unless Baghdad launches a new attack.

“We wouldn’t have declared a suspension if we had any intention of resuming it,” Fitzwater said.

Staff writers Stanley Meisler and John J. Goldman in New York, Elizabeth Shogren in Moscow, Rone Tempest in Paris and Daniel Williams in Jerusalem contributed to this report.