Ordinance on sexual crimes: Women activists angry, criticize ‘key’ omissions

NEW DELHI: No sooner had the Union Cabinet cleared an ordinance to sharpen laws on sexual assault than some women activists questioned the "unseemly haste" in promulgating an ordinance when Parliament is convening only 20 days later. A bipartisan sanction to tougher laws against sex crimes, they said, would carry greater force. Some of them went so far as to say that they would urge the President to not sign the ordinance.

Additional solicitor general, Indira Jaising felt that ordinances should be brought only in an emergency situation that brooked no delay. In this instance there was no such pressing emergency. In fact, greater deliberation would only help to enact a set of stronger — and if need be, more nuanced — laws.

The non-inclusion of marital rape as a crime, even in the period leading up to separation, has come in for sharp criticism from activists.

Jaising said she was disappointed that the Cabinet had not waived government sanction for police to take up cases of rape by armed forces personnel. "While this need for sanction is understandable in the case of encounter deaths, as that might have happened in the course of duty, how can rape be committed in the course of duty?" she said.

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Obama offers faith groups new birth control rule

WASHINGTON (AP) — Facing a wave of lawsuits over what government can tell religious groups to do, the Obama administration on Friday proposed a compromise for faith-based nonprofits that object to covering birth control in their employee health plans.

Some of the lawsuits appear headed for the Supreme Court, threatening another divisive legal battle over President Barack Obama's health care overhaul law, which requires most employers to cover birth control free of charge to female workers as a preventive service. The law exempted churches and other houses of worship, but religious charities, universities, hospitals and even some for-profit businesses have objected.

The government's new offer, in a proposed regulation, has two parts.

Administration officials said it would more simply define the religious organizations that are exempt from the requirement altogether. For example, a mosque whose food pantry serves the whole community would not have to comply.

For other religious employers, the proposal attempts to create a buffer between them and contraception coverage. Female employees would still have free access through insurers or a third party, but the employer would not have to arrange for the coverage or pay for it. Insurers would be reimbursed for any costs by a credit against fees owed the government.

It wasn't immediately clear whether the plan would satisfy the objections of Roman Catholic charities and other faith-affiliated nonprofits nationwide challenging the requirement.

Kyle Duncan, general counsel for the Becket Fund for Religious Liberty, which is representing religious nonprofits and businesses in lawsuits, said many of his clients will still have serious concerns.

"This is a moral decision for them," Duncan said. "Why doesn't the government just exempt them?"

Neither the Catholic Health Association, a trade group for hospitals, nor the U.S. Conference of Catholic Bishops had an immediate reaction, saying the regulations were still being studied.

Some women's advocates were pleased.

"The important thing for us is that women employees can count on getting insurance that meets their needs, even if they're working for a religiously affiliated employer," said Cindy Pearson, executive director of the National Women's Health Network.

Policy analyst Sarah Lipton-Lubet of the American Civil Liberties Union said the rule appeared to meet the ACLU's goal of providing "seamless coverage."

Health and Human Services Secretary Kathleen Sebelius said in a statement that the compromise would provide "women across the nation with coverage of recommended preventive care at no cost, while respecting religious concerns."

The birth-control rule, first introduced a year ago, became an election issue, with some advocates for women praising the mandate as a victory but some religious leaders decrying it as an attack on faith groups.

The health care law requires most employers, including faith-affiliated hospitals and nonprofits, to provide preventive care at no charge to employees. Scientific advisers to the government recommended that artificial contraception, including sterilization, be included in a group of services for women. The goal, in part, is to help women space out pregnancies to promote health.

Under the original rule, only those religious groups that primarily employ and serve people of their own faith — such as churches — were exempt. But other religiously affiliated groups, such as church-affiliated universities, Catholic Charities and hospitals, were told they had to comply.

Catholic bishops, evangelicals and some religious leaders who have generally been supportive of Obama's policies lobbied fiercely for a broader exemption. The Catholic Church prohibits the use of artificial contraception. Evangelicals generally accept the use of birth control, but some object to specific methods such as the morning-after contraceptive pill, which they argue is tantamount to abortion, and is covered by the policy.

Obama had promised to change the birth control requirement so insurance companies — and not faith-affiliated employers — would pay for the coverage, but religious leaders said more changes were needed to make the plan work.

Since then, more than 40 lawsuits have been filed by religious nonprofits and secular for-profit businesses contending the mandate violates their religious beliefs. As expected, this latest regulation does not provide any accommodation for individual business owners who have religious objections to the rule.

Questions remain about how the services ultimately will be funded. The Health and Human Services Department has not tallied an overall cost for the plan, according to Chiquita Brooks-LaSure, an HHS deputy policy director.

However, in its new version of the rule, the department argues that the change won't impose new costs on insurers because it will save them money "from improvements in women's health and fewer child births."

The latest version of the mandate is now subject to a 60-day public comment period. The overall mandate is to take effect for religious nonprofits in August.

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Zoll reported from New York. Associated Press writer David Crary in New York contributed.

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Beyonce Admits to Singing With Pre-Recorded Track

Jan 31, 2013 3:52pm

                                               (Christopher Polk/Getty Images)

Beyonce proved the critics wrong at a press conference for the Super Bowl.

As the singer walked on stage, she asked the audience to please stand. She then kicked off the press conference with a show-stopping, live performance of the national anthem.

“I am a perfectionist and one thing about me, I practice until my feet bleed, and I did not have time to rehearse with the orchestra. It was a live television show and a very, very important emotional show for me. One of my proudest moments,” Beyonce said when asked what happened at the inauguration.

“Due to the weather, due to the delay, due to no proper sound check, I did not feel comfortable taking a risk. It was about the president and the inauguration and I wanted to make him and my country proud. So I decided to sing along with my pre-recorded track, which is very common in the music industry, and I’m very proud of my performance,” she said.

The 31-year-old singer also guaranteed that she will be singing live during Sunday’s Super Bowl halftime show.

“I will absolutely be singing live. I am well rehearsed and I will absolutely be singing live,” Beyonce said. “This is what I was born to do. What I’m born for.”

RELATED: Aretha Franklin ‘Really Laughed’ About Beyonce Lip-Sync Controversy

SHOWS: Good Morning America

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Syria protests over Israel attack, warns of "surprise"

BEIRUT/AMMAN (Reuters) - Syria protested to the United Nations on Thursday over an Israeli air strike on its territory and warned of a possible "surprise" response.

The foreign ministry summoned the head of the U.N. force in the Israeli-occupied Golan Heights to deliver the protest a day after Israel hit what Syria said was a military research centre and diplomats said was a weapons convoy heading for Lebanon.

"Syria holds Israel and those who protect it in the Security Council fully responsible for the results of this aggression and affirms its right to defend itself, its land and sovereignty," Syrian television quoted it as saying.

The ministry said it considered Wednesday's Israeli attack to be a violation of a 1974 military disengagement agreement which followed their last major war, and demanded the U.N. Security Council condemn it unequivocally.

U.N. Secretary-General Ban Ki-moon expressed "grave concern". "The Secretary-General calls on all concerned to prevent tensions or their escalation," his office said, adding that international law and sovereignty should be respected.

Israel has maintained total silence over the attack, as it did in 2007 when it bombed a suspected Syrian nuclear site - an attack which passed without Syrian military retaliation.

In Beirut on Thursday Syria's ambassador said Damascus could take "a surprise decision to respond to the aggression of the Israeli warplanes". He gave no details but said Syria was "defending its sovereignty and its land".

Diplomats, Syrian rebels and security sources said Israeli jets bombed a convoy near the Lebanese border on Wednesday, apparently hitting weapons destined for Hezbollah. Syria denied the reports, saying the target was a military research centre northwest of Damascus and 8 miles from the border.

Hezbollah, which has supported Assad as he battles an armed uprising in which 60,000 people have been killed, said Israel was trying to thwart Arab military power and vowed to stand by its ally.

"Hezbollah expresses its full solidarity with Syria's leadership, army and people," said the group which fought an inconclusive 34-day war with Israel in 2006.

Russia, which has blocked Western efforts to put pressure on Syria at the United Nations, said any Israeli air strike would amount to unacceptable military interference.

"If this information is confirmed, we are dealing with unprovoked attacks on targets on the territory of a sovereign country, which blatantly violates the U.N. Charter and is unacceptable, no matter the motives," Russia's foreign ministry said.

Iranian deputy foreign minister Hossein Amir Abdullahian said the attack "demonstrates the shared goals of terrorists and the Zionist regime", Fars news agency reported. Syrian President Bashar al-Assad portrays the rebels fighting him as foreign-backed, Islamist terrorists, with the same agenda as Israel.

An aide to Supreme Leader Ayatollah Ali Khamenei said on Saturday Iran would consider any attack on Syria as an attack on itself.

In battle-torn Damascus, residents doubted Syria would fight back. One mother of five said she had heard retaliation would come later. "They always say that. They'll retaliate, but later, not now. Always later," she said, and laughed.

"The last thing we need now is Israeli fighter jets to add to our daily routine. As if we don't have enough noise and firing keeping us awake at night."

BLASTS SHOOK DISTRICT

Details of Wednesday's strike remain sketchy and, in parts, contradictory. Syria said Israeli warplanes, flying low to avoid detection by radar, crossed into its airspace from Lebanon and struck the Jamraya military research centre.

But the diplomats and rebels said the jets hit a weapons convoy heading from Syria to Lebanon and the rebels said they - not Israel - attacked Jamraya with mortars.

One former Western envoy to Damascus said the discrepancy between the accounts might be explained by Jamraya's proximity to the border and the fact that Israeli jets hit vehicles inside the complex as well as a building.

The force of the dawn attack shook the ground, waking nearby residents from their slumber with up to a dozen blasts, two sources in the area said.

"We were sleeping. Then we started hearing rockets hitting the complex and the ground started shaking and we ran into the basement," said a woman who lives adjacent to the Jamraya site.

The resident, who declined to be named because of the sensitivity over the strike, said she could not tell whether the explosions which woke her were the result of an aerial attack.

Another source who has a relative working inside Jamraya said a building inside the complex had been cordoned off and flames were seen rising from the area after the attack.

"It appears that there were about a dozen rockets that appeared to hit one building in the complex," the source, who also asked not to be identified, told Reuters. "The facility is closed today."

Israeli newspapers quoted foreign media on Thursday for reports on the attack. Journalists in Israel are required to submit articles on security and military issues to the censor, which has the power to block any publication of material it deems could compromise state security.

Syrian state television said two people were killed in the raid on Jamraya, which lies in the 25-km (15-mile) strip between Damascus and the Lebanese border. It described it as a scientific research centre "aimed at raising the level of resistance and self-defense".

Diplomatic sources from three countries told Reuters that chemical weapons were believed to be stored at Jamraya, and that it was possible that the convoy was near the large site when it came under attack. However, there was no suggestion that the vehicles themselves had been carrying chemical weapons.

"The target was a truck loaded with weapons, heading from Syria to Lebanon," said one Western diplomat, echoing others who said the convoy's load may have included anti-aircraft missiles or long-range rockets.

The raid followed warnings from Israel that it was ready to act to prevent the revolt against Assad leading to Syria's chemical weapons and modern rockets reaching either his Hezbollah allies or his Islamist enemies.

A regional security source said Israel's target was weaponry given by Assad's military to fellow Iranian ally Hezbollah.

Such a strike or strikes would fit Israel's policy of pre-emptive covert and overt action to curb Hezbollah and does not necessarily indicate a major escalation of the war in Syria. It does, however, indicate how the erosion of the Assad family's rule after 42 years is seen by Israel as posing a threat.

Israel this week echoed concerns in the United States about Syrian chemical weapons, but its officials say a more immediate worry is that the civil war could see weapons that are capable of denting its massive superiority in airpower and tanks reaching Hezbollah; the group fought Israel in 2006 and remains a more pressing threat than its Syrian and Iranian sponsors.

(Additional reporting by Mariam Karouny and Oliver Holmes in Beirut, Gabriela Baczynska in Moscow and Marcus George in Dubai; editing by David Stamp and Philippa Fletcher)

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French air strikes hit Islamist bases in north Mali

TIMBUKTU: France said Thursday its warplanes had hit Islamist command posts near the last militant stronghold in northern Mali, as the UN mulled a peacekeeping force to take over the fast-moving French-led operation.

Ground troops gathered at the gates of Kidal, a desert outpost that is the last rebel stronghold yet to be fully recaptured, as France said its fighter jets had blasted command centres, training camps and depots run by Islamist extremists in the mountains north of the town.

Many rebels are believed to have melted away into the desert hills around Kidal since France launched air strikes on January 11 in a surprise assault to block an advance towards the capital, Bamako, by Al-Qaeda linked extremists who have occupied the north for 10 months.

The latest air strikes were carried out over the past few days in the Aguelhok region near the border with Algeria, a French military spokesman told journalists.

To back up the ground troops already in place, a column of 1,400 Chadian soldiers was heading by road towards Kidal from the Niger border, he added.

Defence Minister Jean-Yves Le Drian said France's air attacks had hit the rebels hard.

"The jihadists suffered heavy losses," Le Drian said. "There were numerous strikes which hit their equipment and men.

"The French intervention has succeeded," he added, saying rebel fighters were now on the run.

But, in a sign the insurgents remain a threat, at least two Malian soldiers were killed when their vehicle drove over a landmine in central territory recaptured last week from the rebels, a security source said.

Paris has urged dialogue between "non-armed terrorist groups" and Mali's interim government for a long-term solution to the woes of the country, which straddles the Sahara desert and the region to the south known as the Sahel.

Tuareg desert nomads in the north have long felt marginalised by Bamako, and last January rebels launched the latest in a string of insurgencies, kickstarting Mali's rapid implosion.

Their National Movement for the Liberation of Azawad (MNLA), which had allied with the Islamist groups, rapidly overran the vast desert north.

They were soon thrust aside by the extremists, who imposed a brutal form of Islamic law on areas under their control, where offenders were punished by public whippings, amputations and executions.

Ex-UN chief Kofi Annan said Thursday there was evidence the crisis in Mali was driven by dangerous alliances between drug smugglers, criminal gangs and extremist groups operating across the region's porous borders.

"These developments threaten the stability of our region as we have witnessed so graphically in Mali in recent weeks," he said.

Interim president Dioncounda Traore said he was willing to talk to the secular Tuaregs from the MNLA, but would not meet any of the Islamist groups.

His comments came after a breakaway rebel faction, the Islamic Movement of Azawad (MIA), said it rejected "extremism and terrorism" and appealed to the international community to prevent the deployment of Malian and West African troops in its base, Kidal, 1,500 kilometres northeast of Bamako.

But Traore dismissed the apparent MIA olive branch, saying: "Because fear has now changed sides, they are looking for a way out."

And the Malian army said it already had a reconnaissance unit in the town to prepare the way for more troops.

France, Mali's former colonial ruler, is keen to hand over its military operation to nearly 8,000 African troops slowly being deployed.

UN officials said planning was at an advanced stage to gather those forces together under the umbrella of a formal UN peacekeeping operation.

France now has 3,500 troops on the ground and with support from the Mali army, has retaken several rebel strongholds, including the large regional town of Gao and the fabled desert trading post of Timbuktu, with no resistance.

French soldiers remained at Kidal's airport Thursday, after being blocked by a sandstorm. The defence ministry said they would secure the town when the weather cleared.

With the Islamists on the run, rights groups have voiced fears of widespread abuses and reprisals against Tuaregs and Arabs accused of supporting them, after reports of summary executions by Malian troops.

"All sides have committed very serious violations, and we believe that they should be investigated," said Human Rights Watch's Africa director, Tiseke Kasambala.

The European Union joined the United States and France in raising alarm over reprisal attacks against minorities.

- AFP/jc

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'Vishwaroopam' row: Jayalalithaa steps in, Kamal Haasan thanks her

CHENNAI: More than a week after the storm over " Vishwaroopam" began, Tamil Nadu chief minister J Jayalalithaa on Thursday broke her silence, defending her government's decision to ban it in her state in light of the "grave law and order" problems that the film might have created.

Jayalalithaa said if Muslim organizations and Kamal Haasan were willing to discuss an amicable agreement by deleting objectionable parts, then theatres would be free to show the film. Kamal thanked the CM for "her help" and all but ruled out going to the Supreme Court actor at a press conference in Mumbai later in the day.

"Now that she (Jayalalithaa) has helped us, why should we go (to the Supreme Court)?" Kamal asked.

Dismissing allegations that she had political and personal motives — like Muslim appeasement before 2014 Lok Sabha elections and alleged enmity with actor-director Kamal Haasan — behind the ban, Jayalalithaa emphatically said there were "very real threats to law and order" and that her government's primary responsibility was to maintain peace.

"How is it possible for the government to provide protection to 524 theatres and maintain law and order when we do not have adequate manpower for all the theatres?" Jayalalithaa asked. Her attempt was to allay growing concerns among the people across Tamil Nadu about the fate of the film, and refute charges by the DMK that she had an axe to grind in stalling "Vishwaroopam"'s release. There was also a nationwide backlash against the decision, with the Centre taking a dim view of her government's decision.

"As per the certification law, Jayalalithaa should have approached the Centre if the state government had law and order concerns regarding its screening. It's the Centre that is empowered to review decision on film certification. A film can't be banned by just invoking the Criminal Procedure Code," said a Union minister.

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Hedgehog Alert! Prickly pets can carry salmonella

NEW YORK (AP) — Add those cute little hedgehogs to the list of pets that can make you sick.

In the last year, 20 people were infected by a rare but dangerous form of salmonella bacteria, and one person died in January. The illnesses were linked to contact with hedgehogs kept as pets, according to a report released Thursday by the Centers for Disease Control and Prevention.

Health officials on Thursday say such cases seem to be increasing.

The CDC recommends thoroughly washing your hands after handling hedgehogs and cleaning pet cages and other equipment outside.

Other pets that carry the salmonella bug are frogs, toads, turtles, snakes, lizards, chicks and ducklings.

Seven of the hedgehog illnesses were in Washington state, including the death — an elderly man from Spokane County who died in January. The other cases were in Alabama, Illinois, Indiana, Michigan, Minnesota, Ohio and Oregon.

In years past, only one or two illnesses from this salmonella strain have been reported annually, but the numbers rose to 14 in 2011, 18 last year, and two so far this year.

Children younger than five and the elderly are considered at highest risk for severe illness, CDC officials said.

Hedgehogs are small, insect-eating mammals with a coat of stiff quills. In nature, they sometimes live under hedges and defend themselves by rolling up into a spiky ball.

The critters linked to recent illnesses were purchased from various breeders, many of them licensed by the U.S. Department of Agriculture, CDC officials said. Hedgehogs are native to Western Europe, New Zealand and some other parts of the world, but are bred in the United States.

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Online:

CDC report: http://www.cdc.gov/mmwr

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Phoenix Gunman Shoots Three at Office Complex

A gunman shot and wounded three people at an office building in Phoenix, Ariz., today and police are now searching for the shooter, authorities told ABC News.

There are no reports of deaths at this time.

Police are clearing the office complex in the in the 7310 block of 16th Street, near Glendale Avenue.

Officials say there was only one gunman, who remains at large.

A witness told ABC News she heard several shots, and took cover in an IT closet with several other women. Another witness heard between six and 10 shots fired.

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Police are also investigating a separate scene near Glendale Avenue, according to ABC News affiliate KNXV-TV. It's not clear if it's related to the office shooting.

The shooting took place moments after former Arizona congresswoman Gabrielle Giffords, the victim of a shooting in Phoenix in 2011, testified before Congress on gun control.

In the weeks since 20 students were gunned down at a Newtown, Conn., elementary school on Dec. 14, 2012, several mass shootings have garnered public attention as the nation debates its relationship to firearms.

Five days ago, two men were wounded during a shooting at Lone Star College in Houston, Texas. Earlier this month, a 16-year-old student was arrested after shooting a classmate in Taft, Calif.

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Egypt curfew scaled back as Mursi seeks end to bloodshed

CAIRO/BERLIN (Reuters) - Egyptian authorities scaled back a curfew imposed by President Mohamed Mursi, and the Islamist leader cut short a visit to Europe on Wednesday to deal with the deadliest violence in the seven months since he took power.

Two more protesters were shot dead before dawn near Cairo's central Tahrir Square on Wednesday, a day after the army chief warned that the state was on the brink of collapse if Mursi's opponents and supporters did not end street battles.

More than 50 people have been killed in the past seven days of protests by Mursi's opponents marking the second anniversary of the uprising that toppled Hosni Mubarak.

Mursi imposed a curfew and a state of emergency on three Suez Canal cities on Sunday - Port Said, Ismailia and Suez. That only seemed to further provoke crowds. However, violence has mainly subsided in those towns since Tuesday.

Local authorities pushed back the start of the curfew from 9:00 p.m. to 2:00 a.m. in Ismailia and to 1:00 a.m. in Port Said and Suez.

"There has been progress in the security situation since Monday. Calm has returned," Suez Governor Samir Aglan said.

Mursi, speaking in Berlin before hurrying home to deal with the crisis, called for dialogue with opponents but would not commit to their demand that he first agree to include them in a unity government.

He sidestepped a question about a possible unity government, saying the next cabinet would be formed after parliamentary elections in April.

Egypt was on its way to becoming "a civilian state that is not a military state or a theocratic state", Mursi said.

The violence at home forced Mursi to scale back his European visit, billed as a chance to promote Egypt as a destination for foreign investment. He flew to Berlin but called off a trip to Paris and was due back home after only a few hours in Europe.

Chancellor Angela Merkel, who met him, echoed other Western leaders who have called on him to give his opponents a voice.

"One thing that is important for us is that the line for dialogue is always open to all political forces in Egypt, that the different political forces can make their contribution, that human rights are adhered to in Egypt and that of course religious freedom can be experienced," she said at a joint news conference with Mursi.

SPIRIT OF REVOLUTION

Mursi's critics accuse him of betraying the spirit of the revolution by keeping too much power in his own hands and those of his Muslim Brotherhood, the Islamist movement banned under Mubarak which won repeated elections since the 2011 uprising.

Mursi's supporters say the protesters want to overthrow Egypt's first democratically elected leader. The current unrest has deepened an economic crisis that saw the pound currency tumble in recent weeks.

Near Cairo's Tahrir Square on Wednesday morning, dozens of protesters threw stones at police who fired back teargas, although the scuffles were brief.

"Our demand is simply that Mursi goes, and leaves the country alone. He is just like Mubarak and his crowd who are now in prison," said Ahmed Mustafa, 28, a youth who had goggles on his head to protect his eyes from teargas.

Opposition politician Mohamed ElBaradei called for a meeting of the president, ministers, the ruling party and the opposition to halt the violence. But he also restated the precondition that Mursi first commit to seeking a national unity government.

The worst violence has been in the Suez Canal city of Port Said, where rage was fuelled by death sentences passed against soccer fans for roles in deadly riots last year.

After decades in which the West backed Mubarak's military rule of Egypt, the emergence of an elected Islamist leader in Cairo is probably the single most important change brought about by the wave of Arab revolts over the past two years.

Mursi won backing from the West last year for his role in helping to establish a ceasefire between Israel and Palestinians that ended a conflict in Gaza. But he then followed that with an effort to fast-track a constitution that reignited dissent at home and raised global concern over Egypt's future.

Western countries were alarmed this month by video that emerged showing Mursi making vitriolic remarks against Jews and Zionists in 2010 when he was a senior Brotherhood official.

German Foreign Minister Guido Westerwelle said ahead of Mursi's visit that the remarks, in which Mursi referred to Zionists as "descendants of apes and pigs" were "unacceptable".

"NOT AGAINST JEWS"

Asked about those remarks at the news conference with Merkel, Mursi repeated earlier explanations that they had been taken out of context.

"I am not against the Jewish faith," he said. "I was talking about the practices and behavior of believers of any religion who shed blood or who attack innocent people or civilians. That's behavior that I condemn."

"I am a Muslim. I'm a believer and my religion obliges me to believe in all prophets, to respect all religions and to respect the right of people to their own faith," he added.

Egypt's main liberal and secularist bloc, the National Salvation Front, has so far refused talks with Mursi unless he promises a unity government including opposition figures.

"Stopping the violence is the priority, and starting a serious dialogue requires committing to guarantees demanded by the National Salvation Front, at the forefront of which are a national salvation government and a committee to amend the constitution," ElBaradei said on Twitter.

Those calls have also been backed by the hardline Islamist Nour party - rivals of Mursi's Brotherhood. Nour and the Front were due to meet on Wednesday, signaling an unlikely alliance of Mursi's critics from opposite ends of the political spectrum.

Brotherhood leader Mohamed El-Beltagy dismissed the unity government proposal as a ploy for the Front to take power despite having lost elections. On his Facebook page he ridiculed "the leaders of the Salvation Front, who seem to know more about the people's interests than the people themselves".

In a sign of the toll the unrest is having on Egypt's economy, ratings agency Fitch downgraded its sovereign rating by one notch to B on Wednesday.

(Additional reporting by Tom Perry, Yasmine Saleh and Marwa Awad in Cairo, Yusri Mohamed in Ismailia and Stephen Brown and Gernot Heller in Berlin; Writing by Peter Graff)

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Germany drafts law on banking separation

BERLIN: Germany aims to introduce legislation on banking separation in order to protect customers' deposits from riskier areas of business, according to a draft law seen by AFP on Wednesday.

The government wants the law to come into effect in January 2014 and banks' activities to be separated by July 2015.

It will only apply to institutions with balances sheets over 1.0 billion euros or with risky positions worth 20 pe rcent of the balance sheet value, according to the law.

The rules would affect Germany's two biggest banks, Deutsche Bank and Commerzbank, as well as regional banking giant Landesbank Baden-Wuerttemberg (LBBW).

Banking separation is an idea floated by the head of the Finnish central bank and European Central Bank governing council member Erkki Liikanen as a measure for reducing risk in the banking sector.

But one of Deutsche Bank's co-chief executives, Anshu Jain, has repeatedly slammed the idea, saying it would "greatly harm the German economy and German companies."

He argues that if Deutsche Bank can no longer use deposits to refinance its activities in investment banking, the refinancing costs would automatically rise and that would narrow the financing possibilities of major companies.

At the same time, banks with high deposits would find it difficult to find attractive investments for customers, Jain said.

- AFP/jc

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