(Correcting name of unit officer belongs to in 3rd para)

By Peter Graff

SANGIN, Afghanistan, June 8 (Reuters) - More than an hour into an Afghan-British patrol through the battle-scarred town of Sangin, the British captain is sucking on a sweet.

He offers a candy to one of the Afghan policemen and, with gestures and a few words of Pashto, tells him to keep the bag. The Afghan smiles widely, and pulls a small gift out of his own pocket to offer in return: a tiny plastic bag of hashish.

The British officer, Captain Alex Firmin of the Adjutant General's Corp, politely declined the policeman's illegal narcotics.

But the exchange, witnessed by Reuters, highlighted the sometimes strange friendship evolving between local forces and NATO troops, which the international force's commanders hope might at last bring peace to one of southern Afghanistan's most violent valleys.

For the past year, Sangin was the scene of nearly constant combat, some of the heaviest battles in Afghanistan since the Taliban were ousted in 2001.

British paratroops entered the town a year ago and fought here to nearly the last round of ammunition. The district beyond their base remained largely in the hands of Taliban guerrillas.

Today, the town is eerily quiet. A series of joint American-British offensives over the past several weeks has driven Taliban militants out of the area.

Afghan government troops with British mentors have set up three outposts and three checkpoints guarding the main highway. A new district chief, loyal to the pro-Western government of President Hamid Karzai, has moved into a compound beside a British base.

The area around the base for a few hundred metres is still a devastated ruin. But turn a corner onto the main street and there is life in the bazaar.

Market traders who fled the fighting are returning. Some said they had arrived in the past week. Mounds of fruit, heaps of spices and bright cloth are now for sale. Cheerful little boys in skullcaps scurry in the street.

VICTORY

If the calm should last, it would be a major victory for NATO forces: the first time such a major Taliban stronghold in the province was brought under peaceful government control since NATO arrived here last year.

"This is probably one of the first places where it has gone from being a complete war zone, where there seemed to be no chance of it dying down, into a bit of a success story," says the British commander in the town, Major Jamie Nowell.

"Sangin's been cleared, the government has come in, the police have come."

But NATO will have a hard time winning over a population that survives mainly on the production of illegal drugs.

Sangin is the centre of Afghanistan's opium heartland, a bazaar town where the Helmand and Musa Qala Rivers meet at the foot of two large mountain valleys.

It is brutal desert country, but a centuries-old system of irrigation canals has turned a crescent along the river into fertile territory that allows bone-dry Helmand Province to produce the opium for as much as a third of the world's heroin.

As the main road leaves the town, the fertile area is visible along the river. Scattered throughout neatly tended wheat fields are small opium plantations, the plants already harvested a week or so ago and now shrivelled to grey husks.

The British are trying to reassure the locals that they are not here to destroy their livelihoods. Before the recent offensives, they distributed leaflets saying they were here to fight the Taliban, not eradicate drugs crops.

The Afghan troops are reaching the point where they will be able to guarantee security, said Sergeant John Summerscales, leader of a group of six mentors that live with an Afghan army unit on the north edge of the town.

"You go out on patrol with them, they're great. They're keen as mustard," he said. "They know the people. They are the people. We're getting some really good (intelligence). We're finding things."

Inside the town, trader Ali Mohammed returned last week to the market stall he had abandoned when he fled a few months ago. He has a fridge filled with cold Pepsis for sale, and mounds of ripe tomatoes, potatoes and onions.

"As long as we are safe, that is enough," he says.

So will the Taliban come back?

He shrugs uneasily. "God knows," he says.

But next to him a teenaged boy smiles.

"Of course they will," the boy says. (Read more from Peter Graff's reporting trip to Afghanistan on his blog http://blogs.reuters.com/category/from-reuterscom/embedded-in-af ghanistan/)

AlertNet news is provided by