(Recasts wrapping India, Bangladesh bird flu series)

By Bappa Majumdar

KOLKATA, India, Jan 17 (Reuters) - Villagers at the centre of a bird flu outbreak in India's east refused to hand over their chickens and ducks for culling on Thursday, hampering efforts to stamp out the disease in poultry.

But in neighbouring Bangladesh the culling of thousands of fowl went on smoothly after the virus was detected in three more districts.

In both countries the virus seemed to be spreading with fresh bird deaths reported from new areas. Neither country has reported any human infection.

Veterinary workers coaxed villagers at the centre of an outbreak in India's West Bengal state to hand over their poultry and observe hygiene practices needed to limit the spread of what the World Health Organisation says is the worst bird flu outbreak in India.

The latest outbreak in West Bengal has affected three districts, but officials said the infection could be more widespread as they waited for test results of more birds.

In the quarantined West Bengal village of Margram, villagers told a Reuters photographer their birds were not infected and that they were unhappy with a dollar-a-bird compensation.

Many let loose their ducks and chickens so that veterinary workers found it difficult to catch and kill them.

"We have asked our officers to resolve all disputes and speed up culling," said Sanchita Bakshi, a West Bengal health official, said.

West Bengal had said on Wednesday it could take up to a week to cull 400,000 birds. Only a few thousand had been killed a day later.

Neighbouring Bangladesh culled nearly 25,000 fowls after bird flu spread to three districts of Borguna, Rajshahi and Jessore, a livestock ministry official said.

Fowls were also culled in the southern coastal district of Barisal as the virus spread to 25 of Bangladesh's 64 districts since the detection of H5N1 strain in March last year.

Suspected outbreaks were reported at a farm in northern Rangpur district, where the virus has resurfaced.

The latest outbreak of the H5N1 strain in West Bengal's poultry, the fourth in India since 2006, has killed more than 35,000 chickens and birds.

Chicken deaths were also being reported from new areas in West Bengal, but the state's animal resources minister said it may not be bird flu.

"A total surveillance is in place," minister Anisur Rahaman told Reuters in Kolkata, West Bengal's capital.

But bird flu is putting people off poultry products. In Kolkata chicken sales dropped by half and most airlines operating out of the city had stopped serving chicken. (Additional reporting by Ruma Paul in DHAKA; Writing by Krittivas Mukherjee; Editing by Alistair Scrutton and Sanjeev Miglani)

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