LONDON -- The United States, under pressure from European allies trying to end the war in Bosnia, has agreed to offer the Bosnian Serbs and Serbia fresh incentives as part of a new peace push by major powers, diplomats said Monday.


The diplomats told reporters that Washington reluctantly agreed to the approach at a meeting of officials from the five-nation "contact group" in Paris on Sunday after UN and NATO officials acknowledged that they were powerless to stop the Bosnian Serb assault on the UN-declared safe area of Bihac.


Foreign ministers from the United States, Russia, France, Britain and Germany meet in Brussels on Friday and are now expected to offer Bosnian Serbs the right to form a confederation with Serbia if they accept the international peace plan that they have so far rejected. The plan would divide Bosnia in half between the Serbs and the Moslem-Croat alliance.


In addition, Serbia will be offered more relief from UN sanctions if it helps to bring the Bosnian Serbs to accept the plan and agrees to a scheme that would ease long-running tensions with Croatia. Until now, the United States has fiercely opposed offering any fresh concessions to the Serbs and has taken a pro-Moslem line in Europe's worst conflict since World War II.


But despite the U.S. agreement on new incentives for the Serbs, the rift between Europe and Washington over action in Bosnia has widened sharply over the past few days.


British Defense Secretary Malcolm Rifkind responded angrily Monday to criticism leveled at the UN mission in Bosnia, in particular Britain, by U.S. Senator Bob Dole over the weekend. The Republican senator had said that "the British and French, and primarily the British," were to blame for "a complete breakdown" of NATO's role in Bosnia.


"I think those in Congress who use that language are behaving disgracefully," Rifkind responded in an interview on BBC radio. "I think when we have thousands of brave British soldiers, some of whom have lost their lives, in Bosnia ... it ill becomes people in countries who have not provided a single soldier on the ground to make that kind of criticism."


The remarks marked the angriest public exchanges yet in the disagreement between the two sides. The Europeans have blocked U.S. moves to lift an arms embargo against the Bosnian Moslems, citing concerns for the safety of peacekeepers.


"Get the (UN) soldiers out of the way. Pull 'em out," was Dole's answer to that argument, in an outburst of frustration at the European stance.


U.S. Defense Secretary William Perry had highlighted differences between Europe and the United States in even more apocalyptic terms Sunday, saying that the Serbs had effectively won the war in Bosnia, NATO power could not stop them and it would take 100,000 troops to enforce peace.


The growing crisis in relations between the United States and Europe threatened to spiral out of control, with fears that NATO itself, the bedrock of transatlantic relations for more than 40 years, is damaged beyond repair and that future Yugoslav-style crises will go unchecked as a result.


The failure to protect Bihac has exposed the failure of the UN and NATO systems, and political leaders who until recently glossed over such problems are now openly talking of the dreadful consequences for the future of European security.


"What is happening there is a disgrace for a civilized Europe," German Chancellor Kohl said Monday.


While the United States, European allies and Russia have differed before over how to tackle Bosnia, diplomats say the present crisis is probably the worst since the rift over the Franco-British intervention in Suez in 1956.


"What has happened is that the transatlantic compact has been broken, perhaps beyond repair," one European diplomat said.


On the ground in Bosnia, fighting continued Monday as heavy artillery, mortar and machine-gun fire battered Bihac. A concerted attack by Serb fighters has left them with control of 30-40 percent of the enclave.


(Reuters, AP)