(Updates with delay, PM meeting Maoists, parties)

By Gopal Sharma

KATHMANDU, March 30 (Reuters) - Nepal's once-feared Maoist rebels are expected to join an interim government in the next few days in what would be a major step in a peace deal ending a decade-old civil war that killed 13,000 people, officials said.

Prime Minister Girija Prasad Koirala continued meetings with Maoist chief Prachanda and other leaders of the ruling seven-party alliance on Friday to hammer out a multi-party cabinet, but no decision on exactly when the former rebels would join has been taken.

"We are still discussing the cabinet formation, a common minimum programme and policies of the new government," Deputy Prime Minister Ami Sherchan told Reuters.

"We are trying to finalise this and form the interim government as soon as possible."

Earlier on Friday, the Maoists said they were close to joining the interim administration.

The entry of the Maoists into the government would also be a boost for a peace process that has been strained this year after anti-government protests by ethnic groups in Nepal's southern plains, in which at least 58 people died.

Political parties and human rights groups accuse the Maoists of continuing extortion, kidnappings and intimidation. The U.S. government has said the Maoists must fully renounce violence before they can become part of the political mainstream.

Under the peace deal signed in November, the Maoists have confined their 31,000 fighters to camps, handed over nearly 3,500 weapons to United Nations supervision and joined an interim parliament as the second-biggest group.

Officials said they were trying to name the Maoists in the interim cabinet before Koirala left for India on Sunday to attend a regional economic summit.

The interim government plans to organise elections for a constituent assembly in June which will prepare a new constitution for the impoverished Himalayan nation and decide the future of a monarchy that the Maoists want abolished.

"The main agenda of the interim government is to hold the elections on time," Maoist spokesman Krishna Bahadur Mahara said.

On Wednesday, Baburam Bhattarai, seen as number two in the Maoist party, told Reuters any delay in forming the interim cabinet would make meeting the election deadline difficult. He also accused Koirala of refusing to give Maoists senior cabinet positions such as the defence or home portfolios in the planned government.

The first major task of the interim government will be to fix the date for the elections, Nepal's first in eight years, officials said.

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