By Ana Isabel Martinez and John McPhaul
SAN JOSE, Costa Rica (Reuters) - Talks aimed at solving Honduras' political crisis were deadlocked on Saturday over proposals to reinstate deposed President Manuel Zelaya and form a unity government.
Zelaya agreed to the mediator's idea of a unity government, which would involve sharing power with some of his rivals, but only if those who ousted him in a June 28 coup were excluded, a close aide said.
"There can be no coup mongers," the aide, Allan Fajardo, told Reuters.
Honduras' de facto government, for its part, flatly rejected the proposed power-sharing arrangement and also again ruled out allowing Zelaya to return to power.
"The proposal of a national unity government is unacceptable," Martha Alvarado, the interim government's deputy foreign minister, told Reuters.
Zelaya said in an interview with a Honduran radio station that he would return to Honduras in the coming days despite warnings by the de facto government that he would be arrested.
The negotiations, mediated by Costa Rican President Oscar Arias, began at midday on Saturday in Costa Rica's capital and had not yet broken up by the evening.
The stalemate puts Arias, a Nobel Peace Prize winner, in a tough spot as he tries to broker a solution to Central America's worst political crisis since the end of the Cold War.
The U.S. government has kept to the sidelines as the mediation process unfolded, letting regional players take the lead in a crisis seen as a key test of U.S. President Barack Obama's efforts to improve relations with Latin America.
At the start of the talks, Arias laid out seven points on which he is seeking agreement, including Zelaya's return to power to complete his term ending in January 2010 and the formation of a coalition government with all the country's political parties represented.
Arias also proposed an amnesty for any political crimes committed after the coup and that Zelaya abandon his plans to hold a referendum on extending presidential terms.
Zelaya upset Honduras' business elite and moderates in his own Liberal party with his leftist policies and rhetoric after taking office in 2005, allying himself with Venezuela's socialist President Hugo Chavez.
The military ousted Zelaya and whisked him out of the country, accusing him of violating the constitution by trying to extend presidential term limits.
The Honduran army was on maximum alert on Saturday and boosted its presence in Zelaya's home region of Olancho, where about 100 of his supporters gathered on his ranch, and other places seen as possible points of return, an army source said.
(Additional reporting by John McPhaul in Costa Rica; Esteban Israel, Gustavo Palencia and Juana Casas in Tegucigalpa, and Ivan Castro in Managua; Writing by Louise Egan; Editing by Kieran Murray)
