(Adds U.S. comment, paragraph 9)
BAGHDAD, March 2 (Reuters) - Iranian President Mahmoud Ahmadinejad hailed a new chapter in ties with Iraq and took a jab at the United States over its policies in the Middle East during a landmark visit to Baghdad on Sunday.
Ahmadinejad is the first Iranian president to go to Iraq since Saddam Hussein launched an eight-year war on Iran in 1980, in which 1 million people died. He is also the first leader from the region to visit since the U.S.-led invasion in 2003.
His two-day trip to a country where its long-time enemy the United States has more than 150,000 troops is as much about symbolism as about cementing economic and cultural ties between the neighbours, both run by Shi'ite majorities.
He rejected long-standing U.S. accusations, repeated by President George W. Bush on Saturday, that Iran is arming Shi'ite militias in Iraq who kill American soldiers.
"We tell Mr. Bush that accusing others will increase the problems of America in the region and will not solve them," Ahmadinejad said in translated remarks at a news conference with Iraqi Prime Minister Nuri al-Maliki.
"The Americans have to understand the facts of the region. Iraqi people do not like America."
Ahmadinejad met Maliki at the prime minister's office in the Green Zone -- the U.S.-protected central Baghdad compound that houses government ministries, parliament and the U.S. embassy -- under the almost constant drone of U.S. military helicopters.
U.S. officials in Baghdad have said they will play no role in Ahmadinejad's visit and that the U.S. military will not be involved in protecting him unless they are asked for help.
In Washington, U.S. State Department spokesman Rob McInturff said: "The Iranians and the Iraqis share borders -- they are free to develop their own relationships."
Ahmadinejad said at an earlier news conference with Iraqi President Jalal Talabani that his visit would open a new chapter in relations with Iraq and help regional cooperation.
"A visit to Iraq without the dictator is a truly happy one," he said, referring to Saddam, who was executed by the Iraqi government in December 2006.
Ironically, his trip was only made possible by the U.S.-led invasion. Ahmadinejad has repeatedly called for U.S. forces to leave Iraq, blaming them for sectarian violence that has killed tens of thousands of Iraqis since 2003.
"A developed, powerful and united Iraq is to the advantage of everyone," said Ahmadinejad, the first Iranian president to visit since Iran's 1979 Islamic Revolution.
Talabani said Iraq would seek to oust the Iranian rebel Mujahadeen-e-Khalq (MEK) group, a long-time Iranian demand that was expected to be raised during Ahmadinejad's visit.
"The presence of those terrorists is forbidden by the constitution and we are working to get rid of them," he said.
The U.S. military said in a statement, however, that it was not aware of any armed or organised MEK group in Iraq. It said its fighters had disarmed during the U.S.-led invasion and now lived in a camp with "protected persons" status.
Many of Iraq's Shi'ite leaders were in exile in Iran during Saddam's long rule and analysts say Ahmadinejad will use his visit to show Washington that Tehran is an influential player in Iraq that cannot be ignored.
The Iranian president has also sought to counter U.S. efforts to isolate Tehran over its nuclear programme by trying to improve ties with Arab states in the region.
His visit comes a day before an expected U.N. Security Council vote on a third round of sanctions against Iran over its nuclear programme, which Iran says is for peaceful purposes but the United States says is for nuclear arms.
Pomp and ceremony greeted Ahmadinejad on his arrival, the fanfare a stark contrast to Bush's rushed and secretive visits.
Ahmadinejad held hands with Talabani as they walked down a red carpet as a military band played their countries' national anthems. It was Iraq's first full state welcome for any leader since the U.S.-led invasion.
Ahmadinejad's motorcade drove from Baghdad's airport to Talabani's presidential palace. Visiting foreign dignitaries normally fly by helicopter to avoid the dangerous airport road.
Scattered protests were held in Baghdad and towns with sizeable Sunni Arab populations against Ahmadinejad's visit. (Additional reporting by Dean Yates, Ahmed Rasheed, Aseel Kami, Mariam Karouny, Paul Tait and Mohammed Abbas; Writing by Ross Colvin; Editing by Alison Williams)
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