Iraqis march toward the Shrine of Imam Ali after a reported peace agreement was reached in Najaf, Iraq, early Friday, Aug. 27, 2004. (AP Photo/Jim MacMillan)
NAJAF, Iraq (AP) - Thousands of pilgrims streamed into the Imam Ali Shrine on Friday, and militants who had been holed up in the site left it, handing the keys to Shiite religious authorities after Iraq's top Shiite cleric brokered a peace deal to end three weeks of fighting in this holy city.
Dozens of militants piled Kalashnikov rifles in front of the offices of their leader, radical Shiite cleric Muqtada al-Sadr. Thousands of al-Sadr's militiamen were still believed to be armed in the city, though most were staying off the streets. In one narrow alley, some militiamen could be seen pushing carts full of machine-guns and rocket launchers.
Iraqi forces took control of the Old City, which al-Sadr's Mahdi Army militia had used as their stronghold during the fierce fighting with U.S.-Iraqi forces.
Dozens of Iraqi police and national guardsmen deployed around the compound of the walled, golden-domed shrine in the Old City Friday afternoon - but did not enter. Some kissed the compound's gates, others burst into tears. Some residents of the devastated Old City neighborhood waved to them and yelled out, "Welcome. Welcome."
U.S. forces appeared to have maintained their positions in the Old City.
After a day of prayers and celebrations at the shrine - one of Shia Islam's holiest sites - civilians and fighters left, and al-Sadr's followers handed over the keys to the site to religious authorities loyal to Grand Ayatollah Ali al-Sistani, the esteemed cleric who secured the peace deal.
"Now the holy shrine compound has been evacuated and its keys have been handed over to the religious authority," al-Sistani aide Hamed al-Khafaf told Al-Arabiya television.
The handover the keys was a symbolic, yet crucial, step in ending the bloody crisis that has plagued this city since Aug. 5, killing hundreds of Iraqis and nine U.S. troops, ravaging parts of the Old City and threatening the control of Iraq's interim government.
Al-Sadr ordered his fighters to lay down their arms and leave Najaf and neighboring Kufa after agreeing to the peace deal in a face-to-face meeting the night before with al-Sistani.
"To all my brothers in Mahdi Army ... you should leave Kufa and Najaf without your weapons, along with the peaceful masses," al-Sadr said in a statement broadcast over the shrine's loudspeakers.
Iraq's interim government also accepted the deal, and U.S. forces ordered their troops to cease fire. Police briefly exchanged fire with militants in one part of town Friday, and some U.S. troops were still receiving occasional sniper fire. Nevertheless, most of the city was calm.
The agreement leaves the Mahdi Army intact and al-Sadr free, despite U.S. vows in the past to destroy the militia and arrest its leader. Since the transfer of sovereignty June 28, the Iraqi interim government has said it has no intention of arresting al-Sadr, but wants him to turn his militia into a political party.
Al-Sistani's highly publicized, 11th-hour peace mission also boosts his already high prestige in Iraq and cloaks him in a statesman's mantle, showing that only he could force an accord between two sides that loathe each other.
In the morning, thousands of Shiites marched through Najaf to visit the shrine, one of Shia Islam's holiest, which was at the center of the fighting since Aug. 5. Many kissed its doors as they entered, chanting "Thanks to God!"
U.S. soldiers looked on as people passed in the streets, heading to the shrine. Army 1st Lt. Chris Kent said the peace agreement "appears to be a final resolution. That's what it looks like right now."
Inside, the crowds mingled with Mahdi Army fighters and performed noon prayers. Afterwards, civilians and militiamen streamed out, with some militants chanting "Muqtada, Muqtada."
By the afternoon, the shrine appeared empty, clear of the visitors and the militants.
Police later set up roadblocks on the edge of the Old City, preventing people from entering and searching throngs of people leaving the shrine. Most of those leaving carried no weapons, but police detained four militants carrying grenades.
The U.S. military said it was continuing to monitor the situation and maintain "a supportive posture," according to a statement.
The 75-year-old al-Sistani returned to Iraq after heart treatment in London to intervene for the first time in the bloody conflict, drawing thousands of followers who marched on Najaf and massed on its outskirts.
The Health Ministry said 110 people were killed and 501 were wounded in Najaf and Kufa on Thursday. Twenty-seven of the dead were killed when mortars slammed into Kufa's main mosque, where thousands had gathered to march into Najaf in support of al-Sistani's mission.
The five-point peace plan put forward by al-Sistani calls for Najaf and Kufa to be declared weapons-free cities, for all foreign forces to withdraw from Najaf, for police to be in charge of security, for the government to compensate those harmed by the fighting, and for a census to be taken to prepare for elections expected in the country by January.
There was no immediate word if the U.S. military would accept the provisions on the agreement calling on its forces to leave Najaf, though military leaders have said they were fighting there only at the behest of the government.
In Washington, a senior Bush administration official, speaking on condition of anonymity, said only: "We've seen the developments. We're watching them very closely."
Iraq State Minister Qassim Dawoud said U.S. and coalition forces would pull out of Najaf as soon as interim Prime Minister Ayad Allawi ordered it.
Dawoud added that the government would not try to arrest al-Sadr, who is sought in the slaying of a rival cleric last year.
In the northern city of Mosul, a car bomb exploded as a U.S. military convoy moved through a traffic circle on the western edge of the city, wounding 10 Iraqi civilians and a U.S. soldier, said Army Capt. Angela Bowman.
A gunbattle between U.S. forces and militants erupted Friday in central Baghdad's Haifa Street on Friday, according to an Associated Press photographer on the scene. U.S. troops sealed off the area and explosions could be heard as helicopter gunships circled overhead.
Also, a U.S. soldier was killed in a vehicle accident and a second seriously injured near the volatile city of Fallujah, the military said.
Meanwhile, an Arab-language television station said Friday that it received a video showing the killing of kidnapped Italian journalist Enzo Baldoni, whom militants had threatened to execute if Italy did not withdraw troops from Iraq. Al-Jazeera said the video was too graphic to broadcast but appeared to show Baldoni being slain.
Italian Premier Silvio Berlusconi, a staunch supporter of the U.S.-led war to topple Saddam Hussein's regime, condemned the reported slaying and repeated his statement of Tuesday that Italy's 3,000 soldiers would not abandon the U.S.-led coalition and Iraq's government.
