(Updates with rebel comments)

By Tim Cocks

KAMPALA, Nov 1 (Reuters) - On a historic return to Uganda to meet government officials, The Lord's Resistance Army rebels said on Thursday they might make peace even if the International Criminal Court upholds indictments against them.

Delegates representing the LRA arrived in Kampala to meet government officials in their first visit since peace talks began in neighbouring South Sudan in July last year.

Increasingly cordial talks between LRA delegates and the government have raised hopes of an end to a 20-year war in which tens of thousands have been killed and 2 million displaced.

The top LRA commanders have so far refused to quit their jungle hideouts in east Democratic Republic of Congo to participate in talks, fearing international arrest warrants.

They had refused to sign a deal until the ICC drops the cases but in a U-turn the LRA delegation said indictments in the Hague-based court would no longer prevent peace.

"At the beginning, we didn't understand the ICC. We saw it as a threat," Ayena Odongo, a lawyer and LRA delegate told journalists. "The ICC is an encumbrance on peace ... but that is not to say we are not going to sign if it is not removed."

Odongo said he thought Uganda's national law was capable of handling the ICC's four indictees, including LRA leader Joseph Kony, wanted for crimes such as killing civilians, hacking body parts off victims and kidnapping children.

Ugandan Justice Minister Khidu Makubuya told Reuters late on Wednesday that the government had drafted a law letting rebel war crimes be tried in Uganda, rather than The Hague.

The ICC says it will only accept trials that dish out firm punishments.

"The ICC is neither here nor there. It will die a natural death so long as Ugandans find ... their own alternative justice mechanisms," Ayena said.

For some LRA delegates -- mostly rebel sympathisers from the Ugandan Diaspora in Britain, the United States and Kenya -- it was their first visit home since they fled Uganda after President Yoweri Museveni seized power in a 1986 coup.

"I'm so grateful that I'm here on the soil of my country," the head of the delegation Martin Ojul said, close to tears.

"It is historical for the LRA."

As a symbol of what he said was the LRA's commitment to peace, he released a live dove into the air, which flapped about before flopping downwards into the lap of a diplomat.

"We have been looking forward to this visit for some time," head of the government's peace team Ruhakana Rugunda said.

This year, the two sides signed phase three of a five-stage deal aiming to end a war that killed tens of thousands of civilians and forced two million more to flee their homes.

The LRA say they plan to meet Museveni for the second time before visiting people displaced by the war in northern Uganda.

A brief meeting between the Ugandan president and the LRA in South Sudan a year ago ended in acrimony. (Additional reporting by Francis Kwera in Kampala)

AlertNet news is provided by