By Naomi O'Leary
ROME (Reuters) - Thousands of supporters of Silvio Berlusconi protested in Rome on Sunday against a tax fraud conviction that has rocked Italy's fragile coalition, but the center-right leader said the government must continue.
Addressing the 2,000-strong crowd, a subdued Berlusconi again bitterly attacked what he calls leftist judges and insisted he was innocent, but said he would continue to support the shaky coalition of his center-right People of Freedom (PDL) party with the center-left Democratic Party (PD) of Prime Minister Enrico Letta.
"We have said loud and clear that the government must go forward to approve the economic measures that we asked for and were agreed," Berlusconi told the rally, making clear that he was in no rush to force a snap election as some of his hawkish supporters have demanded.
"What drives us is not our personal interests. Always the interests of everyone and of our Italy come first."
Dressed in a navy t-shirt under a suit jacket, the 76-year-old's restrained performance was a contrast to his usual ebullient public appearances and his voice cracked several times during the address.
Italy's supreme court on Thursday upheld a four-year jail sentence - commuted to one year - for the media mogul. It was the first definitive conviction he has suffered in dozens of trials since he stormed into politics in 1994. He says leftist magistrates are trying to subvert democracy by forcing him out of politics.
He is expected to serve the sentence either under house arrest in one of his luxurious residences or doing community service. Offenders over 70 are not normally sent to jail.
The PDL has been lobbying for President Giorgio Napolitano to pardon Berlusconi, which political sources say he has angrily rejected as impossible for several reasons, including because Berlusconi is still awaiting a verdict in an appeal against a conviction for paying for sex with a minor in the so-called "Rubygate" scandal.
The level of anger in the PDL over the sentence and PD insistence that the law must be upheld have raised real fears of a collapse of the coalition government.
But even if the government continues, the strife is likely to dim hopes for reforms desperately needed to drag the euro zone's third largest economy out of its longest post-war recession.
Defence minister Mario Mauro told newspaper Il Sussidario earlier there was an awareness in the government that the delicate coalition risked breakdown, but any move towards elections is unlikely until parliament returns from its summer recess and Italians from their sacrosanct August holidays.
Analysts point out that Berlusconi may hesitate to bring down the government and force elections because the sentence will prevent him campaigning or standing as a candidate, and the party depends not only on his wealth but his charisma and communication skills.
In addition, until a dysfunctional electoral law is changed, a new election is likely to produce an even more chaotic outcome than the last vote in February.
Head of State Napolitano and Letta both say the country cannot afford another election at a moment of economic crisis.
After his speech, in which he defiantly said he would remain in the political fight, Berlusconi greeted emotional supporters, many of them women, in the crowd. Some of them wept as he shook their hands.
"I'm here to support our leader, who is the only person in Italy and perhaps in Europe acting as a barrier against the advance of the 'red judges'," supporter Marielle Menegatti told Reuters at the rally outside Berlusconi's Renaissance palace home near parliament.
The four times prime minister's words at the Sunday rally may help to calm days of political tension since the supreme court verdict.
One of Berlusconi's most loyal and hawkish supporters, PDL deputy Daniela Santanche, earlier threatened a mass resignation by center-right lawmakers unless Napolitano issued a pardon, which she said was Berlusconi's right.
"We are in a dictatorship. There is a power that has overruled democracy (the judiciary)," Santanche told daily Il Fatto Quotidiano in an interview published on Sunday.
"Berlusconi's conviction deserves a revolution."
(Additional reporting by Roberto Mignucci and Carmelo Camilli; editing by Barry Moody and Giles Elgood)