BISHKEK, June 2 (Reuters) - Dozens of Kyrgyz protesters rallied outside the U.S. embassy in the capital Bishkek on Saturday demanding Washington pull its troops out of their Central Asian state.

Just days before the planned visit of U.S. Defense Secretary Robert Gates, activists shouted "Yankee go home!" and hoisted banners reading "No to the airbase".

The United States, which has more than 1,000 troops in the former Soviet state, set up the base in 2001 to support its operations in Afghanistan. Activists on Saturday urged the government to hold a referendum on shutting it down.

Kyrgyz officials renewed their action against the airbase after the fatal shooting of a Kyrgyz citizen by a U.S. airman at the base in December last year.

The airbase is key to U.S. interests in the region after another Central Asian country, Uzbekistan, evicted American troops in 2005 following Western condemnation of the use of force to quash a revolt in the town of Andizhan.

President Kurmanbek Bakiyev's government has, however, defended the importance of hosting the base -- a key hard currency earner for indebted and impoverished Kyrgyzstan.

Russia, which also has a military airbase there, is irritated by the U.S. presence in the former Soviet region, seen by Moscow as part of its traditional sphere of interest.

Although Kyrgyzstan has sought to maintain good relations with both powers, there have been calls for more cooperation with its former Soviet overlord.

At an opposition congress on Saturday, Felix Kulov, a former prime minister and now the driving force behind the movement, proposed setting up a confederation with Russia which would unite economic policies such as budget planning.

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