By Ayla Jean Yackley
SEMDINLI, Turkey (Reuters) - Kurdish militants began to withdraw from Turkey on Wednesday, pursuing a peace process meant to end a three-decade insurgency that has killed 40,000 people, ravaged the region's economy and tarnished the country's image abroad.
Turkish security forces manned checkpoints along the mountainous border with Iraq, keeping watch as the agreed pullout started by the first small groups of up to 2,000 Kurdistan Workers Party (PKK) fighters.
The withdrawal, ordered late last month by top PKK commander Murat Karayilan, is the biggest step yet in a deal negotiated by the group's jailed leader Abdullah Ocalan with Turkish officials to end almost 30 years of conflict.
The PKK has accused the army of endangering the pullout with reconnaissance drones and troop movements they said may trigger clashes. But there was no sign of military activity in the grey skies over southeast Turkey.
"I can say the withdrawal began today based on the information we have," pro-Kurdish Peace and Democracy Party (BDP) co-leader Gultan Kisanak told Reuters. "Local sources report that the armed PKK militants are on the move."
Security sources did not confirm the withdrawal. Fighters are accustomed to moving furtively and are expected to move in groups of around half a dozen in a process likely to take several months.
"We have observed movement among (PKK) group members, but have not been able to establish whether this is regrouping or preparation for a withdrawal," a security source told Reuters.
The PKK force is small but dogged, with 3,000-4,000 fighters based in Iraq and 1,500-2,000 in Turkey, where they have targeted Turkish troops as well as bombed cities including Istanbul and beach resorts.
The withdrawal will be monitored on the Turkish side by the MIT intelligence agency and across the border by the Kurdish regional government of northern Iraq.
The first fighters were expected to arrive at PKK bases in northern Iraq within a week.
But a PKK commander for the Semdinli area told a local source that guerrillas were unable to cross into Iraq because of increased security, including new checkpoints and soldiers deployed on mountainsides.
On the road to Semdinli, where the PKK launched their insurgency with an attack on August 15, 1984, soldiers and police appeared to be mostly waving regular traffic through.
"I think this is our best chance yet for peace. On the front line, both sides want the bloodshed to stop," said a 30-year-old sergeant among a group of soldiers drinking tea behind a row of sandbags at a checkpoint.
Prime Minister Tayyip Erdogan has taken a huge gamble with the process, attracting a nationalist backlash before elections next year as he seeks to end a conflict which has put a huge burden on state coffers and tarnished Turkey's image abroad.
The PKK, designated a terrorist organization by Turkey, the United States and European Union, said in a statement on Wednesday the Turkish military had bombarded areas around Semdinli with artillery and mortars on Tuesday.
It has reported a series of similar barrages in recent days, but there have been no reports of casualties. Turkey has pledged to maintain the fight against the PKK until they disarm, but Erdogan said they will not be targeted during the pullout.
Few areas have been scarred by the conflict more than Semdinli, accessible by a single road that cuts through emerald-green valleys and snowcapped mountains, and which witnessed the deadliest clashes in more than a decade last year.
"This town has never known normalcy. It has always been in the cross-hairs of war," said 30-year-old Mayor Sedat Tore. He does not remember a time in his life without the violence.
"May 8 represents an enormous opportunity to finally silence the guns. The people don't understand this process fully, but they are hopeful. They are searching for even the smallest ray of light at the end of the tunnel," he said.
Erdogan reiterated a call for the rebels to disarm before leaving. The PKK has rejected this, fearing they could come under attack, as they did in a previous pullback.
"They surely know the routes from which they have entered Turkey and can use the same routes to leave," Erdogan told reporters on Tuesday.
Karayilan has warned that PKK fighters will retaliate if the Turkish army launches any kind of operation against them.
Hugh Pope, Turkey project director for the International Crisis Group, said the withdrawal's significance was symbolic as the fighters will not have disarmed and could return, with the acid test being an absence of clashes to build confidence.
"This is the most promising peace process we've seen," he said. Success, he added, would require a series of reforms to promote reintegration including anti-terrorism laws and Kurdish language education, and amendments to parts of the constitution.
(Additional reporting by Gulsen Solaker in Ankara and Seyhmus Cakan in Diyarbakir; Writing by Daren Butler; Editing by Nick Tattersall and Mark Heinrich)