Israel says it could suspend its peace talks with Syria if Damascus fails to prevent the Islamic resistance movement from carrying out attacks in southern Lebanon.

A statement from Israeli Prime Minister Ehud Barak said there could be no peace "as long as the Syrians do not restrain the Hezbollah for acting against the Israeli army in the security zone".

The statement came after the Iranian-backed Hezbollah killed three Israeli soldiers and wounded four others in an attack near one of Israel's strategic military positions in the region.

Israel accuses Syria - the main power-broker in Lebanon - of turning a blind eye to Hezbollah attacks, and perhaps even encouraging them.

Although Syria and the Hezbollah acknowledge no direct link between the guerrilla group's battle to oust Israeli troops from south Lebanon and the peace negotiations, Israeli officials called for Damascus to halt the violence or risk unpredictable damage to the peace process.

On Sunday, the mainly Shiite Muslim group - which is fighting to oust Israel from southern Lebanon - killed Colonel Akel Hashem, deputy head of the pro-Israel militia, the South Lebanon Army.

Correspondents say the inclusion of attacks on the army as a condition for talks is rare, as Israel has previously insisted that Hezbollah refrain from targeting civilian settlements along Israel's northern border.

In his statement, which was issued on defence ministry letterhead, Mr Barak, a former military chief-of-staff, said: "We have known in the past and we still know to strike at the place and time of our choosing."

Urge for restraint

He described the recent violence as "grave intensification... that Israel would not allow to continue."

On Monday afternoon, the Israeli Government met in emergency session to discuss the latest escalation of violence in Lebanon.

Mr Barak said those responsible for attacks on Israeli soldiers and their client militia would be punished.

But the BBC's Jerusalem correspondent Paul Adams said some Israeli government ministers are urging restraint, resisting opposition calls for major strikes against Lebanon's infrastructure.

Talks break down

The latest attacks come as the United States is trying to bridge gaps that caused high-level talks between Israel and Syria to be adjourned indefinitely earlier this month, after a failure to agree the time-scale for any Israeli withdrawal from the Golan Heights.

Colonel Hashem died on Sunday when a remote-controlled bomb exploded near his car in the Israeli-occupied zone.

Israel responded by launching repeated attacks against Hezbollah bases in southern Lebanon.

Helicopter gunships launched up to ten attacks on Jarjaua, a village and wooded area just outside the Israeli-occupied zone which is thought to be used as an infiltration route by Hezbollah.