By Aung Hla Tun

YANGON, Oct 9 (Reuters) - Myanmar's main opposition gave a cautious welcome on Tuesday to the junta naming its main trouble-shooter as "Minister of Relations" to act as a go-between with detained democracy icon Aung San Suu Kyi.

However, in its first response to a highly conditional offer from Senior General Than Shwe for unspecified talks, Suu Kyi's National League for Democracy (NLD) party said any negotiations should have no prior strings attached.

"If dialogue is to be held with true desire to find a solution, preconditions are not set," the NLD, which won a massive election landslide in 1990 only to be denied power by the army, said in a statement.

However, party spokesman Nyan Win described the appointment of Aung Kyi -- a big hitter in the regime despite being only a deputy labour minister -- as liaison between Suu Kyi and the former Burma's ruling generals as "a good sign".

"It shows they seem to have become a little more pragmatic," he said.

Those who know Aung Kyi said he would be more than an errand boy, suggesting that after crushing the biggest pro-democracy protests in nearly 20 years, the junta might be showing a rare willingness to listen to its opponents and critics.

"He's serious, he's senior and he's been sent in to difficult situations before to resolve them and trouble shoot," a former Yangon-based official of the International Labour Organisation (ILO) said.

"He's not a stonewaller. He's someone who's sent in to fix problems, and he seems like a very good choice if you do want to have a credible dialogue," said the ILO official, who dealt with Aung Kyi directly in a bid to curb the use of forced labour.

"UTTER DEVASTATION"?

After last month's protests against decades of military rule and deepening poverty, Senior General Than Shwe offered direct talks with Suu Kyi if she ended her "confrontation", support for sanctions and "utter devastation" -- a term not clarified.

However, critics said Than Shwe had no intention of ever talking to a woman he is known to loathe, and that the proposal was just a sop to the international outrage at the military crackdown, in which at least 10 people were killed.

Even China, the closest the junta has to a friend, issued a rare call for restraint when the troops moved in to end the biggest anti-junta movement since a 1988 uprising that was eventually crushed with the loss of an estimated 3,000 lives.

However, Beijing underscored its opposition to U.N. sanctions on Tuesday, saying any international response should be "extremely prudent and responsible".

India, another energy-hungry regional giant with its eyes on Myanmar's huge natural gas reserves, has also come under fire for appearing to ignore the protests, which started in mid-August against shock increases in fuel prices.

Foreign Minister Pranab Mukherjee's word-for-word repetition on Sunday of a speech he gave four months ago about the need for closer ties with the generals is being seen as proof of uncompromising real politik in New Delhi.

Suu Kyi, a 62-year-old Nobel laureate, remains under house arrest and incommunicado, as she has been for nearly 12 of the last 18 years. An editorial in Myanmar state newspapers on Monday suggested any release was a dim and distant prospect.

During her previous periods of isolation she has had other "liaison officers" whose mediation with the junta came to nought.

Given the frequency with which optimists have been proved wrong, other analysts cautioned against seeing Aung Kyi's role as leading to talks on restoring a semblance of civilian authority in a country crippled by 45 years of military rule.

"It's too early to assess this gambit by the regime," said a retired professor in Yangon, who asked not to be named. "It comes at a time of mounting pressure from the international community. We need to wait for further movement."

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