ABC NEWS
Iraq says Turkey has 140,000 soldiers along its border with the country's north as part of a "great mobilisation".
Turkey's armed forces have urged its Government to allow an incursion into neighbouring, mainly Kurdish northern Iraq to crush up to 4,000 Turkish Kurdish militants who use the region as a base to attack security and civilian targets inside Turkey.
Rumours of a possible Turkish incursion have rattled financial markets and have drawn warnings from the US, Ankara's NATO ally, to stay out of Iraq.
Tensions have soared along the mountainous border region following an upsurge in attacks across Turkey that Ankara has blamed on Kurdistan Workers Party (PKK) militants.
Iraqi Foreign Minister Hoshiyar Zebari says his country wants dialogue to resolve the issue.
"The Government's stance on this is clear," he said.
"We are against any interference or breach of Iraqi sovereignty from neighbouring states.
"We understand Turkey's legitimate fears over the activities of the Workers Party and view this issue as negotiable.
"There is a joint Iraqi, American and Turkish security committee, and it is the appropriate body to solve all the issues and problems between the two countries."
Turkey's military is known to sometimes shell PKK targets inside Iraq, as well as stage small raids across the border.
While classing the PKK as a terrorist group, Washington fears any major operation by Turkey in northern Iraq could anger Iraqi Kurdish allies and stoke wider conflict in a relatively peaceful region of the war-torn country.
Iraq has previously said its security forces were badly stretched tackling unrelenting violence elsewhere and did not have spare troops to send to the border region.
Turkey's centre-right Government is under mounting public pressure to take tough action as July 22 parliamentary elections loom.
Nationalist parties are expected to do well in the polls.
Ankara blames the PKK for the deaths of more than 30,000 people since the group launched its armed campaign for an ethnic homeland in south-east Turkey in 1984.
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