Key Points:

Shiite militia loyal to the firebrand cleric Moqtada al-Sadr extended their control over Basra yesterday, causing the American military more troubles as British troops begin their withdrawal from Iraq.

As soon as British forces had handed over the Basra joint police command centre to Iraqi police, Sadr's men moved in, according to reports. The handover was to be the first stage of the British troops' final withdrawal.

The United States military is now reported to be planning to send 3000 troops to fill the void left by the British withdrawal.

According to witnesses yesterday, Iraqi police left when the Shiite fighters arrived and began emptying the facility. They made off with generators, computers, furniture and even cars, saying it was war booty - and were still in the centre yesterday.

The embarrassing episode, which comes as the British in Basra are preparing to move their remaining soldiers to the city airport as part of a planned withdrawal, again highlights the strength of the militia in the city.

It further undermines Britain's hopes of a smooth transfer and gives the impression of a rout. Sadr boasted last week that the British had "given up" and were retreating because of the Iraqi resistance.

A small detachment of British soldiers working with the Iraqi police left the central Basra building on Sunday.

However, the British military disputed the reports about the Shiite militiamen turning up yesterday, saying the Iraqi general in charge of security in Basra denied that Sadr's Mehdi Army was there.

The withdrawal leaves British forces with just two military bases in Iraq, Basra Palace and Basra airport, provoking speculation that the Army may accelerate its withdrawal to the fringes of the southern capital. Britain has reduced its military presence to just 5500 troops in Iraq and intends to pull these remaining forces back to the airport and hand Basra province over to Iraqi control, possibly within months.

Sadr last week said Britain had "realised this is not a war they should be fighting or one they can win. The British have given up and they know they will be leaving Iraq soon. They are retreating because of the resistance they have faced. Without that, they would have stayed for much longer, there is no doubt".

The head of the British Army, General Sir Richard Dannatt, said that his forces were under great pressure because they were deployed on two combat fronts, Afghanistan and Iraq. His comments were interpreted as an indication that Government policy was to leave Iraq swiftly so the military could concentrate on the Taleban in Afghanistan.

Reports that the Americans were sending 3000 troops to Basra appeared to confirm previous comments by an American Army general, Jack Keane, who was vice-chief of staff at the time the Iraq war began in 2003. He warned last week that any British withdrawal from the country may need to be plugged by American forces.

But the Ministry of Defence denied last night that Sunday's handover of the police joint command centre in Basra was a signal for any kind of retreat.

A spokesman for the MoD said that the withdrawal was "in the framework of the plan for the handover" of British positions in the city to Iraqi control and its police force.

The MoD also tried to scotch any suggestion that the Americans were poised to send a stabilisation force to southern Iraq in the wake of a British pullout. "There hasn't even been a decision as to when we leave Iraq so this proposal seems very unlikely," said the spokesman.

- Independent