GUWAHATI, India -- A powerful rebel group in northeast India Friday threatened to pull out of a cease-fire if the Indian government continued to insist they surrender their arms and give up their demand for sovereignty.

"The Nagas will never lay down three things from their hands -- their arms, their freedom and their territories," said a statement by the National Socialist Council of Nagaland (NSCN). "There should be no illusion whatsoever. Failure to honor the commitment may therefore be disastrous and may bring the end of everything."

The NSCN has been waging a violent insurgency, which has claimed more than 25,000 lives so far, for an independent homeland for the Naga people in the hilly Nagaland state bordering Myanmar.

Led by guerrilla leaders Isak Chishi Swu and Thuingaleng Muivah, the rebel outfit is currently currently holding peace talks with the government after a cease-fire was declared in 1997.

Swu and Muivah held talks with Indian Prime Minister Atal Bihari Vajpayee in New Delhi in January.

Despite the cease-fire, NSCN members are still carrying arms, although the truce prohibits the display of weapons.

New Delhi lifted a ban on the NSCN in November 2002, 12 years after it was imposed.

The NSCN threat to call off the cease-fire comes amid reports that New Delhi is contemplating moves to disarm the rebels and also begin negotiations with its rival NSCN faction headed by S.S. Khaplang.

Indian peace negotiator K. Padmanabhaiah is expected to hold the next round of talks with NSCN at an undisclosed venue in Europe sometime next week. The NSCN is the oldest and the most powerful of the nearly 30-odd rebel armies operating in the region since India's independence in 1947. (AFP)