U.S., Afghan troops exchange fire with Pakistanis

* U.S., Afghan troops exchange fire with Pakistani forces

* Pakistani forces fire at two U.S. helicopters

* Two sides disagree whose airspace the aircraft were in

* Rice meets Zardari

* U.S. suspends visa services in Pakistan, citing security

By David Morgan

WASHINGTON, Sept 25 (Reuters) - U.S. and Pakistani ground forces exchanged fire across the Afghanistan-Pakistan border on Thursday after two U.S. military helicopters were shot at from a Pakistani border post, U.S. officials said.

No casualties or injuries were reported in the exchange, but the incident escalated tensions between Washington and Islamabad following a stepped-up U.S. campaign of attacks on militant targets inside Pakistan, including a Sept. 3 U.S. commando raid on a village compound in South Waziristan.

Accounts of Thursday's incident differed widely, with U.S. and Pakistani officials clashing over where it occurred.

Pakistan's military said its soldiers fired warning shots at the helicopters after they intruded into Pakistani airspace. The United States said the two aircraft were operating inside Afghanistan.

The OH-58 Kiowa helicopters were protecting a joint American-Afghan military patrol operating about 1 mile (1.6 km) inside Afghanistan when Pakistani forces opened fire from an outpost on the Pakistani side of the border, according to a U.S. military official.

"The (helicopters) did not return fire but the ground forces fired suppressive fire at that outpost. The Pakistani forces then returned that fire. The whole exchange lasted about five minutes," said the official with U.S. Central Command in Tampa, Florida, which oversees American military operations in Afghanistan and Iraq.

A senior defense official said U.S. ground forces fired on the Pakistan border post twice. "The suppressive fire was aimed in front of the border post, not at it," the official said. "When the Pakistanis then returned fire, our forces answered with direct fire. Then it ended."

Earlier in the day, a U.S. military spokeswoman in Afghanistan said the helicopters had been flying a routine operation and were about 7 miles (11.5 km) on the Afghan side of the border when they "received small arms fire from a Pakistani military checkpoint."

The U.S. forces were operating under NATO command. Officials said the helicopters were not damaged in the exchange.

"This is an unfortunate incident. It just goes to demonstrate the importance of coordination along that border," Pentagon spokesman Bryan Whitman told reporters.

"The flight path of the helicopters at no point took them over Pakistan," he said. "The Pakistanis have to provide us with a better understanding of why this took place."

Pakistani military spokesman Maj. Gen. Athar Abbas offered a different account, saying: "There were two helicopters from Afghanistan that crossed into Pakistani territory. Our soldiers fired warning shots and those helicopters returned fire and flew back."

'UNCLEAR' BORDER

The rugged Pakistan-Afghanistan border region is a crucial theater for the United States in fighting al Qaeda and the Taliban. Frustrated by an intensifying insurgency, U.S. forces have stepped up attacks inside Pakistan with repeated missile strikes and a helicopter-borne ground assault this month.

Pakistan strongly condemned those operations and said it would stand up to cross-border aggression and refuse to tolerate any violation of its territory.

"We avoided a serious incident," Whitman said, adding, "The incident is troubling, no doubt."

Adding to the confusion, Pakistani President Asif Ali Zardari said in New York his forces had only fired warning flares, "just to make sure that they know they have crossed the border line."

Speaking to reporters with U.S. Secretary of State Condoleezza Rice, Zardari said it was often hard to make out the border with Afghanistan. Rice echoed, "Yes, the border is very, very unclear."

She told Zardari, sworn in this month after a bruising battle to force the resignation of former military leader and U.S. ally Gen. Pervez Musharraf that "there is a lot that still can to be done and this is a new day for Pakistan." (Editing by Peter Cooney) (Additional reporting by Zeeshan Haider in Islamabad, Sue Pleming in New York and Jonathon Burch in Kabul; Editing by )