Asia Crisis

REFILE-Three killed in raid in Thailand's Muslim south

(Adds dropped words "..attributed the decline.." in paragraph 7)

YALA, Thailand, March 21 (Reuters) - Two policemen and a suspected rebel were killed on Friday during a house raid in a village in Thailand's Muslim south, where nearly 3,000 people have died in four years of separatist unrest, police said.

The two policemen, a Muslim and a Buddhist, were shot dead during a raid on the home of a suspected guerrilla in Yala, one of the four southernmost provinces roiled by the violence.

Fifty soldiers and police then stormed the one-storey house and killed a 25-year-old Muslim man, police said.

The raid followed clashes on Wednesday between security forces and insurgents suspected of killing a 70-year-old Buddhist shopkeeper.

Two Muslim men, one of whom was believed to be a leading member of an insurgent group and with a 500,000 baht ($16,000) bounty on his head, died in that operation, police said.

After several months of relative calm, the incidents mark an escalation of violence in the majority Malay Muslim region, which used to be an independent sultanate until annexed by Buddhist Bangkok a century ago.

A university think-tank that has been cataloguing the unrest attributed the decline to the deployment of more troops by new army chief Anupong Paochinda, who took office in October.

Anupong said a group of Thai academics had met with two groups of exiled rebels in Geneva but they were not representing the government in any way.

"I can assure you the government has never in any negotiations with those wrongdoers," he told reporters after a meeting of top security officials in Bangkok.

After the same meeting, Prime Minister Samak Sundaravej stressed Bangkok would never hold talks with insurgents. ($1=31.17 baht) (Reporting by Surapan Boonthanom and Pracha Hariraksapitak; Editing by Ed Cropley and Alex Richardson)