* Maliki offers amnesty to militiamen

* Suicide bomber kills nine in Diyala

By Khalid al-Ansary

BAGHDAD, April 4 (Reuters) - Iraqi Prime Minister Nuri al-Maliki said on Friday his security forces would stop arresting militiamen if they give up their weapons, apparently seeking to defuse tensions with Shi'ite cleric Moqtada al-Sadr.

In a statement, Maliki said he would grant amnesty from prosecution to anyone who took part in clashes in southern Iraq and Baghdad last week if they handed in their guns.

The statement appeared to soften Maliki's position from Thursday, when at a news conference he threatened a crackdown on Sadr's strongholds in Baghdad.

It was released just before Muslim midday prayers in Baghdad. Sadr has called for a "peaceful sit-in" after the prayers to protest against bombings, arrests and vehicle bans that continue to seal off parts of the capital.

"To give space and an opportunity for those who are remorseful and are willing to give up their weapons, all pursuits and raids in all areas will be stopped. Those who take up arms will face the law," Maliki said.

Maliki ordered a crackdown on militia in the southern city of Basra last week but his army faced stiff resistance from the Mehdi fighters. U.S. and British forces had to launch air and artillery strikes to support Iraqi troops.

Sadr's movement has already told the Mehdi Army to ignore previous Maliki orders for members to hand in their weapons.

Maliki had been increasingly uncompromising toward the Sadrists, fellow Shi'ites who backed Maliki's rise to power in 2006 but split with him a year ago, partly over Maliki's refusal to set a timetable for the withdrawal of U.S. forces.

The spokesman for Iraq's military in Baghdad, Major-General Qassim Moussawi, said security forces would not attempt to prevent any mass sit-in on condition people were not armed.

MILLION-STRONG MARCH

The fiery Sadr has also called for 1 million Iraqis to march against what he calls the U.S. occupation of Iraq next week. The government has said it would not attempt to block the march in the holy Shi'ite city of Najaf if it was peaceful.

The demonstration, called for the fifth anniversary of the fall of Baghdad on Wednesday, raises the prospect of unrest coinciding with a politically sensitive progress report to Congress by the top U.S. officials in Iraq.

Sadr has millions of followers and was able to summon tens of thousands of people on to the streets in Baghdad for demonstrations during last week's fighting.

The violence exposed a deep rift within Iraq's majority Shi'ite community and served as a reminder of the instability after months of security improvements.

Hundreds died, making March the deadliest month for Iraqi civilians since last August, according to government figures.

Iraq's violence last week was mostly in Shi'ite areas in the south and Baghdad. But in a reminder of the threat from militants in Sunni Arab areas in the north, a suicide bomber blew himself up at a funeral on Friday in Diyala province.

The attack killed nine people and wounded 30 others, a senior Iraqi security official said.

The bomber struck as people gathered at a cemetery near the town of Hamrin, north of the provincial capital Baquba, for the funeral of a policemen who had been killed on Thursday, said Abdul Kareem al-Rubaie, commander of Diyala security operations.

A U.S. military spokesman confirmed the strike.

"This barbaric attack continues to show the desperate and horrific measures these individuals will stoop in order to hurt the innocent Iraqi people," said Captain Stephen Bomar, spokesman for U.S. troops in northern Iraq. (Writing by Dean Yates; editing by Keith Weir)

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