By Marco Aquino
YURIMAGUAS, Peru (Reuters) - Hundreds of Peruvian Indians protesting mining and oil exploration in their native lands held 38 police hostage on Saturday after battles with security forces killed up to 33 people in the worst violence of President Alan Garcia's government.
Thousands of Indians with wooden spears blocked highways in the Amazon jungle and pledged to keep up protests if police do not halt efforts to clear weeks of road blocks.
The escalating protests have interrupted food and fuel supplies and could damage Garcia, who is already unpopular among poor Peruvians who oppose his drive to open up trade and attract foreign investment.
Tribes, worried they will lose control over natural resources, have protested since April seeking to force Congress to repeal new laws that encourage foreign mining and energy companies to invest billions of dollars in the rainforest.
"We are not going to give up until they reverse these laws that will damage us. They want to take away our lands and forest and make our traditions disappear," said Luis Huansi, a leader of the Shawi tribe from the Loreto region, at a highway blockade between the Amazon towns of Tarapoto and Yurimaguas.
Men, women and children from the subsistence farming region were blocking the highway, some dressed in long red tunics, wearing headbands and carrying wooden spears. Families have set up tents of plastic sheeting along the side of the road.
Defence Minister Antero Flores said on Saturday security forces had regained control of an oil pumping station of state-owned Petroperu, which protesters had threatened to set fire to.
SOME DEAD FROM SPEAR WOUNDS
Violence broke out on Friday as police tried to disperse a roadblock on another highway at a place called "Devil's Curve" in the Bagua region of Amazonas province, about 870 miles north of Lima, the capital.
Indigenous leaders said at least 22 protesters were killed. The government reported the deaths of three protesters and 11 police officers, some from spear wounds. At least 100 people were injured and more conflict appeared possible.
Government ministers urged calm but defended the use of force.
Interior Minister Mercedes Cabanillas told reporters on Saturday morning that officials have had no contact with the police hostages.
"They are there. What's worrying me is they've taken away their weapons," she said.
The bloodshed, which prompted calls for Cabanillas and Garcia's prime minister to quit, has underscored deep divisions in Peru between wealthy elites in Lima and poor indigenous groups in the countryside.
It also has exposed the central government's lack of control over remote regions of the country.
Late on Friday, in a separate incident, the army said one soldier was killed and four injured when a remnant band of Shining Path rebels shot explosives at one of its helicopters parked at a base in the coca-growing zone of the Apurimac and Ene Valleys east of Lima.
The group led an insurgency for years against Peru's government but went into the cocaine trafficking business after its leaders were captured in the 1990s.
Garcia, whose approval rating is 30 percent, is especially unpopular in the Amazon, where development has lagged.
Critics say he has not done enough to lower the poverty rate from 36 percent and that economic boom times enjoyed before the current downturn failed to reach the poor.
They also say his policies favouring free markets and foreign investment mainly benefit elites in cities.
Some of the controversial laws that have upset indigenous groups were passed last year as Garcia moved to bring Peru's regulatory framework into compliance with a free-trade agreement with the United States.
After the deadly violence on Friday, members of Garcia's Cabinet accused protesters of being inflexible and refusing to negotiate. They said they would impose curfews.
Indigenous leaders expressed outrage and said Garcia's allies acted in bad faith when they blocked a motion in Congress on Thursday to open debate on a law that tribes want overturned.
"We don't have guns, we have only these spears," said Huansi, shaking his spear.
(Writing by Terry Wade and Fiona Ortiz; Editing by Eric Beech)
