By Douglas Hamilton and Erika Solomon
BEIRUT (Reuters) - Syria says the year-long revolt to topple President Bashar al-Assad is now over, but it will keep its forces in cities to "maintain security" until it is safe to withdraw in keeping with a U.N.-backed peace deal.
The agreement proposed by United Nations-Arab League special envoy Kofi Annan says the Syrian authorities must be first to withdraw troops and stop violence immediately.
The army kept up an offensive against opposition strongholds on Saturday, pummelling the Khalidiya district of Homs city.
"Mortars are falling every minute and the sounds of explosions are shaking the neighborhood," an activist report said. A child was killed by rocket fire in the al-Bayyada area and a man was killed in crossfire in clashes near a checkpoint.
Rebels battled army forces near a base in Jaramaneh in Damascus province. Five bodies bearing signs of torture were found near Maarat al-Noaman, the report said. A soldier was killed when rebels ambushed a troop carrier in Deraa province.
Despite the violence, Damascus says it has the upper hand.
"The battle to topple the state is over," Syrian Foreign Ministry spokesman Jihad al-Makdissi told Syria TV late on Friday. "Our goal now is to ensure stability and create a perspective for reform and development in Syria while preventing others from sabotaging the path of reform."
His assertion follows army victories over rebel strongholds in the cities of Hama, Homs and Idlib, and Assad's acceptance this week of Annan's plan that does not demand he step down.
Calls by Gulf Arab states to arm the rebels have fizzled. The political opposition remains divided, and prospects of Western-led military intervention are close to zero.
Assad has endorsed Annan's six-point peace plan, which has the U.N. Security Council's unanimous backing, but Western leaders say the 46-year-old Syrian leader has broken similar promises before and must be judged by actions not words.
Assad's opponents have not yet formally accepted the plan.
"FRIENDS OF SYRIA"
They were due to meet the foreign ministers of allied Western powers, including U.S. Secretary of Sate Hillary Clinton, on Sunday at a "Friends of Syria" conference in Turkey, which provides a safe haven for Syrian rebels.
Makdissi said Annan, who had talks with Assad in Damascus on March 10, had acknowledged the government's right to respond to armed violence during the ceasefire phase of the peace plan.
He said Syria's conditions for agreeing to Annan's plan included recognition of its sovereignty and right to security.
"When security can be maintained for civilians, the army will leave, he said. "This is a Syrian matter."
However, Annan's plan says Syria must stop putting troops into cities forthwith and begin taking them out.
"The Syrian government should immediately cease troop movement towards, and end the use of heavy weapons in, population centers, and begin pullback of military concentrations in and around population centers," it states.
"As these actions are being taken on the ground, the Syrian government should work with the envoy to bring about a sustained cessation of armed violence in all its forms by all parties with an effective United Nations supervision mechanism," it says.
The U.N. peacekeeping department will send a team to Damascus soon to begin planning for a possible ceasefire observer mission, Western diplomats said on Thursday, adding that it was unclear the 200 to 250 monitors envisaged would ever be deployed. "We are very far from a peace to keep," one said.
Western diplomats say the key to the implementation of Annan's ceasefire -- the main thrust of the deal -- lies in the sequencing of the army pullback and ending rebel armed attacks.
They say the opposition won't feel safe negotiating before the army halts its offensive, but also note it would be impractical to expect a complete government pullout before the rebels are obliged to respond.
In 2011, an Arab League observer mission sent to oversee the promised withdrawal of the Syrian army from opposition flashpoints collapsed partly over the issue of when and how troops could be withdrawn.
HEZBOLLAH SAYS REVOLT FAILED
More than 9,000 people have been killed by Assad's forces during the revolt, according to the United Nations, while Damascus says it has lost about 3,000 security force members.
"The armed opposition is incapable of toppling the regime," said Sayyed Hassan Nasrallah, leader of Assad's Lebanese ally Hezbollah. Foreign intervention was a "closed subject", he said.
"Betting on military efforts to topple the regime is a losing gamble and the burden is too great: more bloodshed and loss of life and property, to no avail," he said on Friday.
Western and Arab foreign ministers backing Syrians trying to topple Assad head for Istanbul on Saturday for what diplomats predict will be a challenging "Friends of Syria" conference.
They will seek clear endorsement of the Annan plan from the Syrian National Council (SNC), although their own governments are skeptical that Assad will genuinely try to implement it.
In Libya a year ago, the West and the Arabs quickly granted recognition to a revolutionary national council as the sole legitimate government of Libya. They are not close to doing the same for the splintered SNC in Syria, diplomats say.
There is also little chance they will agree to arm rebels.
The Istanbul conference is instead expected to declare strong support for Annan's peace proposals, which do not include an opposition and Arab League demand that Assad go now. It is expected to demand that he order a ceasefire without delay.
If he does not withdraw his forces, the opposition can hardly be expected to begin a dialogue with him, diplomatic sources said. If he does, one question will be how effectively they can persuade disparate armed rebel groups to stop shooting.
The Istanbul conference may press for immediate steps "to accept and implement a daily two-hour humanitarian pause", as Annan's plan stipulates, until all fighting ceases.
If Assad fails to keep his word, Annan would have to decide whether to call time and tell the United Nations he has failed to make peace through a "Syrian-led process".
The issue would then return to the U.N. Security Council, with increased pressure on Assad's allies Russia and China, which have endorsed Annan's mission, to get tough with Damascus.
Russia, however, has warned in advance that it is not up to the "self-styled friends of Syria" to pronounce on Sunday on whether Assad is keeping his part of the Annan deal or not.
Diplomats say "Friends of Syria" powers construe the carefully-worded terms of Annan's six-point plan as intending that Assad will eventually cede power in a political transition. but the language is nuanced to get a step-by-step process going.
"I think inevitably we will see frustration this weekend. We are all frustrated," said one Western diplomat, speaking on condition of anonymity. "It is frustrating that after more than a year, the violence continues in Syria and has been particularly brutal over the last two or three months and at the moment does not seem to be stopping."
(Additional reporting by Adrian Croft in London, John Irish in Paris, Steve Gutterman in Moscow, Dominic Evans in Beirut; Writing by Douglas Hamilton; Editing by Alistair Lyon)