Fighting Erupts Amid Russian Hostage Crisis

Three days after Chechen rebels stormed into a Russian town and took up to 2,000 people hostage in a hospital, a major battle broke out early today, with heavy artillery and small-weapons fire audible throughout the town.

It was not immediately clear whether the guerrillas had broken out of the hospital or whether Russian officials had stormed the site, as they had hinted earlier they might do.

The battle followed a day of uncertainty and anger in Budennovsk, a town of 100,000 about 70 miles from the Chechen border.

On Friday, as 31 bodies were unloaded from refrigerator trucks and carried past a sweaty, sobbing crowd into Bathhouse No. 1, the people of Budennovsk cursed the Chechen attackers and the man that they blamed for the Chechen war, Boris Nikolayevich Yeltsin.

“They should never have started this war,” said Svetlana Shakhsadova, 33, referring to the faraway Russian leadership in Moscow. “They should have shut our border tight against the Chechens and let them eat each other.”

The circle of women around her nodded, holding handkerchiefs over their noses to block the stench and to catch their tears. All had come to the bathhouse to scan the faces of the dead in hopes that their missing relatives would not be among them but would turn out to be among those being held at gunpoint at the hospital.

“Yeltsin should be watching this,” one woman shouted as grim-faced men dragged yet another corpse from the truck and a despairing young woman folded at the waist like a rag doll.

“No, he can’t see it; he’s gone to Canada,” another said. The crowd echoed angry agreement with opposition leaders in Moscow, who criticized Yeltsin for departing for the Group of Seven industrialized nations meeting in Canada while hundreds or thousands of his countrymen were held hostage.

“He has shown the world that his own prestige is more important to him than the lives of his people,” a 19-year-old Russian soldier who gave only his first name, Alexei, said bitterly. “For someone who was planning to run for president, not in Canada but in Russia, it’s a suicidal step.”

While Yeltsin suggested before his departure from Moscow that he was headed to the G-7 summit in Canada to persuade Western doubters that Russia’s military crackdown on Chechnya is a justified anti-terrorist action, he arrived in the Canadian seaport of Halifax in a buoyant, even playful, mood.

Smiling and waving as he jauntily descended from his Ilyushin aircraft, he bantered with flag-waving schoolchildren who had come out to greet him and thrilled them with a running, sideways “high-five” handshake along the length of his red-carpeted path to a waiting motorcade.

Russian Economics Minister Yevgeny G. Yasin briefed journalists on Yeltsin’s talk with Canadian Prime Minister Jean Chretien but made no mention of the unfolding crisis back home.

In Budennovsk, negotiations had appeared to falter Friday between Russian authorities and guerrilla leader Shamil Basayev, a popular and charismatic Chechen field commander who has reportedly lost 11 family members during Russia’s six-month war to subdue secessionist Chechnya.

Basayev reportedly refused a Russian offer of an aircraft and safe passage for him and his estimated 50 or 60 men to any nation that would accept them. He continued to demand that Russia cease all military action in Chechnya.

As the official death toll rose to 67 and unconfirmed reports put the toll at 117, senior Russian officials had hinted Friday that an attempt to storm the hospital might be imminent.

“The terrorists understand that they will have nowhere to retreat, and . . . they will not surrender,” Defense Minister Pavel S. Grachev said. “Forcible actions are needed to liquidate these bandits and not allow the blood of hostages to be spilled.”

Grachev’s predictions were viewed with a certain skepticism here since he vowed seven months ago that Chechen secessionism would be crushed by one paratrooper division in a single afternoon. But his warning was echoed by Sergei V. Stepashin, head of the Federal Security Service, who told reporters: “We will do our best to avoid bloodshed--meaning we will do our best to protect the people if they start eliminating them.

“I would not call it storming,” Stepashin added. “It’s called freeing the people.”

“Let them come and storm the place,” Basayev, the rebel leader, said at a news conference inside the hospital Thursday night. “It does not matter to us when we die. What matters is how we die. We must die with dignity.”

But in a sign that hope for a negotiated settlement was not lost, Basayev’s younger brother, Shirvani Basayev, arrived in Budennovsk on Friday afternoon and met with Deputy Prime Minister Nikolai D. Yegorov for about 20 minutes at the town’s police headquarters.

Shirvani Basayev was the military commander of the Chechen mountain headquarters in Vedeno until the Russians captured the city and other rebel holdouts in a string of recent military victories. A Russian private escorting the younger Basayev said the commander had been given safe passage from the neighboring Dagestan republic in hopes he could influence his brother.

The trip was approved by Chechen President Dzhokar M. Dudayev, the private said. Although Dudayev had said days before the attack that Russia would “burn in hell” for what it did in Chechnya, he has said that he does not condone taking civilian lives.

After meeting with Yegorov, Shirvani Basayev walked out of the police headquarters smiling, wearing a black-brimmed hat banded with the Islamic green ribbon that signified his willingness to die for the Chechen cause. He drove off with Yegorov, but there was no immediate word as to their destination.

Nor was it clear whether Shamil Basayev’s decision to unconditionally release the 31 bodies--after previously demanding an exchange of corpses--was linked to his brother’s arrival.

Two children were released Friday morning. On Thursday, Basayev said, five captured Russian officers had been shot and two female hostages released.

Official estimates of the number of hostages ranged from 500 to 5,000, but reporters who were invited to tour the hospital late Thursday said they believe the true number of captives is perhaps 2,000.

“Nobody knows how many people are really inside,” said Alexander M. Suchkov, a senior prosecutor.

Russian television showed scores of hostages sitting on mattresses and in corridors. Most were calm, but a few could be heard yelling, “Let us out!”

Embattled human rights activist Sergei A. Kovalev arrived in Budennovsk on Friday and said he was tempted to try to persuade Shamil Basayev, whom he has met several times before, to release the hostages. But Yeltsin’s former human rights adviser, who has been branded a “traitor” by Grachev, said he has been unable to contact top Russian officials to authorize his mission.

“To storm would be madness,” Kovalev said. “It would only mean heaps of corpses. I’m not sure anyone would be left alive.”

Except for people gathered at the bathhouse to identify the bodies, Budennovsk was a ghost town Friday.

During Wednesday’s attack, the rebels stormed several city buildings, dragged people out of their cars, dragooned them from city buses, rounded them up at the local telegraph office and marched them to the captured hospital. They terrorized the town for three hours before police reinforcements arrived.

Residents yanked their children, their cars and their animals into their courtyards and closed their high steel gates. Many were still barricaded in their homes Friday.

Budennovsk is located in the rich flat farmlands of Stavropol, the region where former Soviet leader Mikhail S. Gorbachev was raised. The wheat fields and cornfields lining the road look much like those in the U.S. Midwest, except for the occasional Kazakh woman riding bareback after her cattle.

Like the bombing in Oklahoma City, the terror of this June attack in bucolic Budennovsk has stabbed the Russian heartland, leaving residents with a new sense of vulnerability.

Those who have relatives inside the hospital said they have no faith that the Russian authorities would get them out alive. Still, they clung to hope.

“They should give them whatever they want, stop the war, just make an agreement so they will let the hostages go,” Yelena Pigunova, 28, said, sobbing. Her husband’s natural gas truck had been found halfway through his daily delivery route, but he has not been seen.

“I hope he’s inside. I can’t find him anywhere,” Pigunova said, her broad, freckled face swollen with tears. “We have three children. I don’t know how I’m going to continue to live. I was raised in an orphanage. I don’t have any family of my own.

“I hope he’s inside the hospital.”

Times staff writer Carol J. Williams contributed to this report from Halifax, Canada.