DHAKA, Sept 7 (Reuters) - Bangladesh's army-backed interim government on Sunday relaxed emergency rules to allow limited trade union activity, after transport workers threatened to go on strike over demand for bargaining rights.

"Certain emergency provisions have been relaxed for allowing trade union activities in factories, industrial units and business enterprises," a Home Ministry statement said.

Trade union activities were banned after the interim government took over in January 2007, following months of political violence, and imposed a state of emergency.

The Bangladesh Transport Workers Union threatened last week to go on indefinite strike from Sept. 14 unless curbs were removed or eased.

"Labour organisations and trade unions will be allowed to hold meetings inside their offices with prior permission from authorities." the ministry said.

Under the emergency, all political activities, street protests and rallies were also banned. But the authorities relaxed the ban on indoor politics in the middle of this year.

Political parties are demanding complete lifting of the emergency to allow full political activities ahead of parliamentary elections the government has promised to hold before end of this year.

Using emergency rules the authorities also detained nearly 170 politicians, including two former prime ministers, for alleged corruption, and put most of them on trial.

But under mounting pressure from the parties and to try to bring all the major parties to the polls, the authorities have paroled former prime minister Sheikh Hasina, allowing her to travel to the United States for medical treatment.

The High Court has also granted bail to at least 40 other detained political leaders, including Tareque Rahman, elder son and likely political heir to another detained former prime minister, Begum Khaleda Zia.

Khaleda's lawyers on Sunday filed bail petitions in two of the four corruption charges she faces, and said they expect her to be freed after the High Court considers her plea on Tuesday.

(Reporting by Nizam Ahmed; editing by Robert Hart)

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