* Desert state votes for first time since August coup
* Junta leader Abdel Aziz expected to win election
* One injured in overnight shooting, but Saturday calm
(Updates with African Union quote)
By Vincent Fertey
NOUAKCHOTT, July 18 (Reuters) - Mauritanians voted on Saturday in an election meant to signal to donors and investors the country is ready to rejoin the international community after a much-criticised military coup last August.
Queues formed outside voting booths in the capital Nouakchott, with voters keen to participate in elections that were scheduled for June 6, but delayed in order to end an opposition boycott that would have damaged their credibility.
Junta leader General Mohamed Ould Abdel Aziz is favourite to win the vote in the Sahara desert Islamic state, analysts say, but there are alternatives in Ely Ould Mohamed Vall as well as veteran opposition figure Ahmed Ould Daddah.
Vall mounted a coup in 2005, a popular move which ousted a long-standing military ruler and laid the foundations for the country’s first free elections in 2007.
"This election represents the most important challenge ... where our country chooses to either come out of a crisis which is a very grave crisis, and extremely dangerous for our country, or it chooses to remain in this crisis," Vall said.
Abdel Aziz’s promises of food and fuel price cuts are likely to endear him to Mauritanians, 40 percent of whom live under the poverty line.
"The most likely scenario is for Aziz to become leader, but this time through the ballot box," said Global Insight analyst Kissy Agyeman-Togobo.
If none of the candidates emerge as outright winner, a decisive second round will be held on Aug. 1.
International donors such as the European Union and United States halted aid programmes in protest at the coup, but a transparent vote would be a step towards restarting cooperation.
Neither the EU nor United Nations have sent observers, but there are more than 200 overseeing the election from organisations including the African Union (AU) — which lifted sanctions this month — and the Arab League.
"We have seen large numbers of voters, which is a good sign," AU envoy Mohamad Saleh Annadif said. "In all the polling stations we have visited, all candidates have been represented, which shows that everyone is contributing to a transparent election."
Police shot and injured a man during an overnight raid on suspected members of al Qaeda’s North African wing in which two men were arrested.
The raid was linked to the killing of an American aid worker in Nouakchott last month rather than linked to the election, police said, and the streets were calm on Saturday.
"The operation was the result of a large manhunt for elements of al Qaeda," police divisional commissioner Mohamed Lemine Ould Ahmed said. One of the detained men had been wearing a belt rigged with explosives, he added.
A free vote would set a positive example to the rest of the region, where military coups and constitutional crises have become a feature of politics in the past year.
"This crisis has lasted almost a year, and we’re impatient to vote now. It’s the only way of getting out of this crisis and returning to normality," said Oumar Dicko, who runs an Internet cafe in the sandy capital.
Abdel Aziz made combating terrorism a cornerstone of his justification for seizing power, accusing President Sidi Mohamed Ould Cheikh Abdallahi of slackening off on al Qaeda.
Mauritania is an ally of the West in the fight against the group, though the international marginalisation that began after the August coup intensified when it shut the Israeli embassy in March in protest at the Jewish state’s invasion of Gaza.
Until then, Mauritania had been one of only three Arab countries to have full diplomatic relations with Israel.
"We are likely to see Aziz attempting to restore ties with traditional donors," Agyeman-Togobo said.
"But this will require something of a balancing act for the man who has adopted a more radicalised stance towards Israel, which could see relations with U.S. ally, Egypt, and other Western powers compromised."