(Adds details, government comment) MADRID, March 17 (Reuters) - Tens of thousands of rival demonstrators marched in northern Spain on Saturday over proposals for an independent Basque state and peace talks with separatist guerrillas ETA. Kept apart by riot police, it was the first time the two sides in the bitter dispute over Basque independence came face to face after weeks of protests against ETA and Spain's socialist government. Regional elections are due in May and a national vote in 2008, and the demonstrations are viewed as opposition moves to score points against the government over ETA violence, which is judged the country's greatest problem in opinion polls. ETA's political ally Batasuna proposed in February that the autonomous region of Navarra and the adjacent Basque country, form an independent Basque state. In a sea of Spanish and Navarran flags, opposition Popular Party supporters marched through the Navarran city of Pamplona to protest against any merger. The Popular Party says the socialist government of Prime Minister Jose Luis Rodriguez Zapatero is offering up Navarra to Basque separatists, an assertion rejected by Madrid. Spanish Deputy Prime Minister Maria Teresa Fernandez de la Vega said on Saturday Navarra would never be part of a peace process and the opposition had invented the threat. "Rights and Liberty; Navarra is not negotiable" read banners, as protestors shouted "Zapatero resign" and "Navarra is not for sale." Flanked by hundreds of riot police, trade unionists backing Basque independence marched nearby and came within 100 metres of the larger opposition demonstration. Polls show only 10 percent of Navarrans support annexation of their region in an independent Basque state. Spain's government called off an ETA peace process in January after the guerrillas killed two people when they set off a car bomb at Madrid's Barajas international airport. Spain's opposition opposes any talks with ETA until the group surrenders its arms, having killed nearly 850 people in the last four decades to back its demands for independence. Zapatero's poll ratings have suffered in the wake of anti-ETA demonstrations and the government's decision to allow a hunger striking separatist to serve out a prison sentence under house arrest."
