(Adds Iraqi government raising toll in Blackwater shooting)

By Dean Yates

EAST OF BAQUBA, Iraq, Oct 7 (Reuters) - The U.S. military commander in Iraq stepped up accusations over the weekend that Iran was inciting violence there and said Tehran's ambassador to Baghdad was a member of the Revolutionary Guards Qods force.

In Baghdad, Iraq's government raised the death toll from a shooting involving U.S. security contractor Blackwater to 17, from 11 previously. A spokesman accused the firm of "deliberate killing" and said its guards fired without provocation.

Washington accuses Iran's Revolutionary Guards' elite Qods force of supporting militias who have attacked U.S. troops.

General David Petraeus, speaking at a U.S. military base about 30 km (20 miles) from the Iranian border on Saturday, said Iran was giving militia groups advanced weaponry and guidance.

"They are responsible for providing the weapons, the training, the funding and in some cases the direction for operations that have indeed killed U.S. soldiers," Petraeus told a group of reporters when asked if the Iranian government was responsible for killing U.S. troops.

Iran dismissed Petraeus's comments as "baseless". Iranian Foreign Ministry spokesman Mohammad Ali Hosseini told a news conference Petraeus's remarks were "not new".

AMBASSADOR ACCUSED

Petraeus did not say how he knew Iran's ambassador to Baghdad, Hassan Kazemi-Qomi, was a Qods force member, but he appeared to suggest the envoy was not under the U.S. military spotlight because he was a diplomat.

"The ambassador is a Qods force member," Petraeus said.

Kazemi-Qomi has twice met U.S. ambassador Ryan Crocker in Baghdad this year for landmark talks on ways to stabilise Iraq. The discussions have made little headway.

In August President George W. Bush, already at odds with Iran over its nuclear programme, said attacks on U.S. troops with Iranian-supplied weapons were increasing and he had told commanders in Iraq to "confront Tehran's murderous activities".

Since then, U.S. military officers have repeatedly presented what they say is evidence of Iranian-produced arms, including the particularly deadly explosively formed projectile (EFP) bombs, being used against U.S. soldiers.

U.S. forces are also holding six Iranians captured this year that it accuses of being Qods force officers.

Tehran routinely denies U.S. accusations that it plays a role in Iraq's violence, as well as Western allegations its nuclear programme is aimed at developing atomic weapons.

The U.S. military also said it had caught three Iranian- backed "special groups militia" believed to be behind the kidnapping of five Britons in a May raid blamed on Shi'ite militiamen loyal to anti-American cleric Moqtada al-Sadr. There is still no word on their fate.

BLACKWATER

An investigative committee set up by Prime Minister Nuri al-Maliki had found no evidence Blackwater guards had come under fire during the Sept. 16 shooting in west Baghdad, government spokesman Ali al-Dabbagh said.

In a statement, he said Blackwater guards had "violated rules governing the use of force". Iraq's cabinet would look at the investigative committee's recommendations and "take the legal steps to hold the company to account", Dabbagh added.

Blackwater has said its guards responded lawfully to an attack on a U.S. State Department convoy. The incident provoked outrage among Iraqis who see private security firms like Blackwater, which protects U.S. diplomats in Baghdad, as private armies that act with impunity.

The U.S. embassy said a joint U.S.-Iraqi committee reviewing diplomatic security after the shooting had met for the first time on Sunday.

The U.S. military, which has poured 30,000 extra soldiers into Iraq to try to stem the sectarian warfare between Iraq's majority Shi'ite and minority Sunni Arabs, says the troop "surge" has helped reduce some of the killing.

Eight people were killed in three bombings in Baghdad on Sunday.

(Additional reporting by Dominic Evans and Paul Tait in Baghdad)

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