By Martin Petty
BANGKOK (Reuters) - Myanmar's army and ethnic Kachin rebels clashed for an eighth day on Thursday in mountains near the border with China and hundreds of people fled in anticipation of a heavy offensive by government troops, Kachin sources said.
Townships close to two Chinese-built hydroelectric dams held by Kachin separatists were emptying fast, with an estimated 2,000 people sheltering in a camp run by the Kachin Independence Organization (KIO), the rebels' political arm.
Some 7,000 more had set up tents and shelters in the jungle along the troubled frontier and others had crossed into China, said Lahpai Naw Din, head of the Thai-based Kachin News Group, citing sources on the ground.
"Many have fled their homes after reports of reinforcements being sent by the government. Everyone fears the clashes will escalate into heavy fighting and that they will be targeted by troops," he said, adding the number of casualties was not known.
The fighting, which began last Thursday, has killed at least four people according to the Washington-based U.S. Campaign for Burma.
A spokesman for the KIO's War Office in Kachin State confirmed there had been no let-up in the fighting.
The KIO battled the central government for decades but agreed to a ceasefire in 1994 under which their fighters were allowed to keep their arms.
But tension has been rising since last year, largely because the Kachin have been resisting government pressure to fold their men into a state-run border security force.
Information is difficult to obtain from the remote northern Myanmar states of Kachin and Shan and the country's military-backed government has made no mention of the conflict in any of the newspapers or television channels it controls.
Analysts say the 10-week old government, Myanmar's first civilian-led administration in five decades, is intent on seizing control of the rebellious states but is reluctant to engage in conflict with numerous factions at this point.
They say the government is probably under pressure from China, its biggest economic ally, to secure the two hydroelectric plants on the Taping River owned by Datang Corporation, a Chinese state company, which says 90 percent of the power generated will flow into China's power grid.
Chinese-built dams have been divisive projects, with ethnic minorities in Myanmar seeing the construction as expanding military presence into their territory. Some analysts say Kachin rebels may be trying to hold the dams hostage in return for a share of the revenue from the projects.
The unrest has raised fears the fighting could spread and intensify a wider, decades-old conflict between ethnic minority factions and Myanmar's army, which has repeatedly ordered rebels to disarm and join the state-run Border Guard Force.
Some small groups have complied, but the larger Shan State Army, Kachin Independence Army and the powerful United Wa State Army, among others, have resisted and vowed to protect the enclaves they have ruled for decades.
Myanmar's pro-democracy leader, Aung San Suu Kyi, has sought to revive a plan devised by her late father, independence hero Aung San, to grant a degree of self-determination to ethnic minorities but her efforts have been rejected as interference by the country's uncompromising rulers.
Many Kachin are Christian and their fighters helped British and other allied troops fighting against Japanese forces in what was then known as Burma in World War Two.
(Editing by Alan Raybould and Robert Birsel)