Combet writes off leadership talk

Labor MP Greg Combet has written off speculation over the party's leadership as "media excitement". Source: AAP

KEY Labor frontbencher Greg Combet has written off speculation over the party's leadership as "media excitement".

The breaking of the agreement between the Australian Greens and Prime Minister Julia Gillard and a dive in the polls for Labor have renewed talk of a change of leadership ahead of the September 14 election.

But caucus members have differing views on which strategy to take - the prime minister standing firm, a "bloodless" replacement of Ms Gillard by Kevin Rudd, or the less likely option of workplace relations minister Bill Shorten.

However the prevailing view - held by senior ministers including Mr Shorten, Treasurer Wayne Swan, Senate leader Stephen Conroy and Mr Combet - is that they stick with Ms Gillard.

Mr Rudd has consistently ruled out a challenge following his failure to win a caucus ballot in February 2012.

Asked whether Ms Gillard's leadership was safe, Mr Combet told ABC Radio: "Of course it is."

"I'm a strong supporter of the prime minister and despite all of the media excitement we are getting on with governing," he said.

Mr Combet told the Australian Workers' Union (AWU) conference on the Gold Coast on Wednesday it was a "tough time" for Labor.

"We know that times are tough in the Labor Party and the government at the moment.

"I don't need to tell you about the polls, and some of the challenges we've got ... but when confronted with tough times, the tough get going.

"We've got to get going across the labour movement."

Suspended Labor MP Craig Thomson, who remains close to a number of caucus members in both the Rudd and Gillard camps, said it was a "challenging time".

"I don't think it's any secret that there is counting going on," he told AAP on Wednesday.

He said Mr Shorten and his AWU-right faction base was the key to the leadership.

"Once the AWU switches its view, it's all over," Mr Thomson said.

"But Shorten is a movable feast on this.

"Bill will do what is in Bill's interest and if he thinks he can save it, that is what he will do.

"But I wouldn't discount him bringing back Rudd.

"He will make sure he is on the winning side."

Opposition Leader Tony Abbott said Labor was focused on bringing down the prime minister rather than governing.

"What is happening in the Labor party at the moment has nothing to do with the Australian people and everything to do with the faceless men who run the Labor party," he told reporters in Melbourne after touring a factory.

Asked about Mr Shorten's prospects, Mr Abbott said: "Bill has a very high opinion about himself."

Earlier, Mr Abbott signalled the coalition was preparing for a possible change of Labor leader.

Asked on Fairfax Radio if it had a strategy to deal with such an eventuality, Mr Abbott said: "That's a fair judgment."

Mr Shorten this week told the AWU conference Ms Gillard was a "tough leader for tough times".

"I know from my conversations with plenty of people we're united in terms of supporting Julia Gillard as leader," he told delegates.

Left-faction powerbroker and minister Mark Butler said the party was locked in behind Julia Gillard.

"I'm not for turning," Mr Butler told ABC radio.

"I think we've made it clear ... this matter was resolved 12 months ago in February.

"I think Kevin (Rudd) himself has probably now run out of metaphors for cooling things down."

Mr Butler said the solution to the government's poll woes was to focus on good policy.

"I'm confident that if we do that in the lead-in to the election we will be very competitive at the election," he said.

However, the minister conceded that some caucus members were backgrounding journalists about the leadership.

"It's important we all focus on the issues that affect the daily lives of voters ... rather than the internal machinations of one party or another and the several dozen opinion polls that we are going to have to endure between now and September," Mr Butler said.

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Hong Kong stocks end 0.71% higher

HONG Kong shares have closed up 0.71 per cent after the Dow on Wall Street hit a five-and-a-half year high and following strong German investor sentiment data.

The benchmark Hang Seng Index added 163.50 points to 23,307.41 on Wednesday on turnover of HK$65.59 billion ($A8.21 billion).

The rise partly offset the index's 1.3 per cent fall on Monday and Tuesday but analysts said they did not expect to see further gains soon, with KGI Asia chief operating officer Ben Kwong saying "any strength ... will likely be capped in the absence of major catalysts".

On Wall Street the Dow rose 0.39 per cent to its best level since October 12, 2007 and the S&P 500 was up 0.73 per cent, hitting its highest point since October 31, 2007. The Nasdaq gained 0.68 per cent.

Reports that office supply retailers Office Depot and OfficeMax were planning a tie-up followed last week's news of a merger between American Airlines and US Airways, and the Berkshire Hathaway-3G Capital takeover of Heinz.

Hopes for an end to Europe's struggles were also boosted by the ZEW economic institute investor confidence index in Germany, which soared to 48.2 points in February from 31.5 points in January, its highest level since April 2010.

The reading beat market expectations for a much more modest increase to 35 points.

Among Hong Kong blue chips Bank of China rose 2.2 per cent to HK$3.80 and China Construction Bank added 1.7 per cent to HK$6.50.

Chinese car makers also mostly jumped. Great Wall rose 3.5 per cent to HK$32.35 and Brilliance was up 2.5 per cent to HK$11.28 but Geely eased 1.9 per cent to HK$4.56.

Chinese shares closed up 0.60 per cent. The benchmark Shanghai Composite Index rose 14.27 points to 2,397.18 on turnover of 97.2 billion yuan.

Developers posted healthy gains on bargain-buying after suffering recent losses fuelled by fears of more moves by the government to cap rising property prices.

China Merchants Property Development added 3.3 per cent to 26.37 yuan, Gemdale Corp. gained 2.7 per cent to 7.12 yuan and China Vanke was up 2.1 per cent at 11.44 yuan.

And pharmaceutical companies rose after two cases of bird flu in humans were reported this month.

China Resources Double Crane Pharmaceutical rose 10 per cent to 27.16 yuan and Shanghai Modern Pharmaceutical jumped 7.42 per cent to 14.19 yuan.

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Demand more highway funds, Labor MPs told

LABOR MPs in NSW are being asked to pressure their colleagues in Canberra to provide funds for badly needed upgrades to the Pacific Highway.

Roads Minister Duncan Gay on Wednesday challenged Labor politicians to show their support for the move to a dual carriageway by demanding the federal government honour the commitment it made with the previous NSW government.

"NSW Labor can show the people who live along and travel the Pacific Highway they are genuinely interested in their welfare by phoning, writing or emailing their federal colleagues demanding the Gillard government restore the 80:20 funding split," he said.

The NSW government has complained it has been left more than $2 billion short to finish converting the highway to dual carriageway.

It says Canberra's insistence of a 50-50 funding agreement breaches the original agreement for a 20-80 split, which state Labor signed with Federal Transport Minister Anthony Albanese.

"The baseline funding split agreed to in the MoU was 83 per cent federal 17 per cent NSW, which later increased even further to a funding ratio of 86:14," Mr Gay said in a statement.

"All the NSW government is seeking from the federal government is the same funding split of 80:20 afforded to the previous state Labor government."

Mr Gay claimed contributions to the Pacific Highway started to reduce dramatically after the O'Farrell government came to office in early 2011.

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Violence marks Indian strike

SPORADIC violence has broken out in India at the beginning of a two-day strike by labour unions protesting rising prices and government policies to open the economy.

Millions of bank and factory workers stayed away from work and public transport was shut down on Wednesday after India's major trade unions called the countrywide strike.

Workers armed with iron rods smashed factory windows and set a fire truck and several cars on fire in Noida, an industrial suburb of Delhi.

A labour leader was fatally crushed when he tried to stop buses from leaving a terminus in the northern city of Ambala.

Trade unions oppose government policies to open the retail, banking and aviation sectors to foreign investors in a bid to jump start India's sputtering economy.

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Pistorius fought with Reeva 'non-stop'

"BLADE Runner" Oscar Pistorius has returned to court to hear explosive allegations he fought "non-stop" with his slain girlfriend Reeva Steenkamp on the night of her killing.

With the South African sporting hero already facing a tough fight on Wednesday to win bail, the prosecution presented police evidence to flesh out the charge he deliberately murdered the cover girl on Valentine's Day.

Prosecutor Gerrie Nel told the court an unnamed witness "heard talking that sounded like non-stop fighting from two to three in the morning" shortly before Steenkamp was found dead at Pistorius's Pretoria home last Thursday.

Police investigator Hilton Botha also said 29-year-old Steenkamp was shot three times through the bathroom door, with wounds to her head, elbow and hip.

Botha said the shots were not fired straight at the toilet door, but rather "directly to the toilet, the basin itself".

"If you walk in directly and fire straight at the door you will miss the toilet," he said, suggesting Pistorius had been aiming.

Steenkamp, who had been going out with Pistorius since late last year, was declared dead shortly before 4.15am (local time) on February 14 by medics and was found covered in towels and wearing white shorts and a black vest.

Botha also said 26-year-old Pistorius would face an additional charge of possessing unlicensed .38 special calibre ammunition.

At Tuesday's hearing, the Olympic and Paralympic track star tearfully denied premeditated murder, a charge that risks a life sentence.

Pistorius told the court he shot at Steenkamp through a locked bathroom door, mistakenly believing she was a burglar.

"I had no intention to kill my girlfriend," he said.

With only the suspect and the victim in the house at the time of the killing, the state's case is expected to focus heavily on forensic evidence and witnesses who are alleged to have heard the couple argue.

Prosecutor Gerrie Nel argued on Tuesday Pistorius deliberately fired four shots into the bathroom door after putting on his prosthetic legs, hitting a terrified Steenkamp three times and fatally wounding her.

"She could go nowhere," Nel said.

"She locked the door for a purpose."

On Tuesday the double amputee track star broke down in tears repeatedly as his own words from his own affidavit filled the court: "We were deeply in love and couldn't be more happy.

"I am absolutely mortified by the events and the devastating loss of my beloved Reeva," he said in his first public comments on the killing.

As the court hearing proceeded on Tuesday, Steenkamp was laid to rest at an emotional private ceremony at a crematorium in her hometown of Port Elizabeth.

Pistorius was an inspiration to millions as the first double amputee to compete against able-bodied athletes at last year's London Olympics.

Pistorius said he had awoken in the dead of night when he heard a noise at his upscale home in a gated Pretoria estate

"Filled with horror and fear" that someone was in the bathroom, he said he felt "very vulnerable" because he did not have his prosthetic legs on.

He said he fired shots at the toilet door and shouted to his girlfriend to phone the police, but then realised it could have been Steenkamp in the bathroom.

After smashing the door with a cricket bat, Pistorius said "Reeva was slumped over but alive".

He said he kept a firearm under his bed at night because he had been a victim of violence and burglaries before and had received death threats.

Magistrate Desmond Nair said he could not rule out that there was some planning involved in the killing, which may be considered as a premeditated murder, setting a high bar for bail.

Pistorius, who off the track has had a rocky private life with stories of rash behaviour, beautiful women, guns and fast cars, has built up a powerful team of lawyers, medical specialists and public relations experts for his defence.

The Paralympian gold medallist became the first double amputee to run against able-bodied athletes at last year's Olympics in London on the carbon-fibre running blades that inspired his nickname.

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China's army controls hackers: US firm

CHINA'S army controls hundreds if not thousands of virulent and cutting-edge hackers, according to a US internet security firm that says it's traced a host of cyberattacks to an anonymous building in Shanghai.

American company Mandiant says its hundreds of investigations show that groups hacking into US newspapers, government agencies, and companies "are based primarily in China and that the Chinese government is aware of them."

The 74-page report focused on one group, which it called APT1 from the initials for "Advanced Persistent Threat."

The New York Times, citing experts, said the group was targeting critical infrastructure such as the US energy grid.

"We believe that APT1 is able to wage such a long-running and extensive cyber espionage campaign in large part because it receives direct government support," Mandiant said.

The group, it said, was believed to be a branch of the People's Liberation Army, called Unit 61398, and digital signatures from its cyberattacks were traced back to the direct vicinity of a nondescript, 12-storey building on the outskirts of Shanghai.

"We believe the totality of the evidence we provide in this document bolsters the claim that APT1 is Unit 61398," it said, estimating it is "staffed by hundreds, and perhaps thousands of people."

China dismissed the allegations.

"It is neither professional nor responsible to make groundless accusations without hard evidence and is also not conducive to solving relevant problems," foreign ministry spokesman Hong Lei said in Beijing.

"China is firmly opposed to hacking," he told reporters, adding that the country was "also a major victim of cyberattacks" and they had been increasing in recent years.

Many had come from overseas IP addresses, Hong said, adding: "Among all the cyberattacks against China, those from the US rank number one."

China's defence ministry did not immediately respond to requests for comment.

A series of brazen IT attacks on America's most high-profile media outlets, reported by The New York Times and the Wall Street Journal, as well as on Twitter and others, have revived concerns over Chinese hackers.

The Times said hackers stole corporate passwords and accessed the personal computers of 53 employees after the newspaper published a report on the family fortune of China's Premier Wen Jiabao.

Clients including The Times have hired Mandiant to clean up their systems after cyberattacks.

In its report, Mandiant alleged that APT1 - known also as "Comment Crew" for its practice of planting viruses on the comment sections of websites - has stolen hundreds of terabytes of data from at least 141 organisations spanning 20 industries.

The Times, which was given early access to the report, said the researchers had found that the Comment Crew was increasingly focused on companies involved in US infrastructure, including in its electrical power grid, its gas lines and water works.

One target, the newspaper reported, was a company with remote access to more than 60 per cent of oil and gas pipelines in North America.

In his recent State of the Union address, US President Barack Obama said the potential ability of outsiders to manipulate critical US infrastructure was a major concern.

"We know foreign countries and companies swipe our corporate secrets," Obama said.

"Now our enemies are also seeking the ability to sabotage our power grid, our financial institutions, our air-traffic control systems.

"We cannot look back years from now and wonder why we did nothing in the face of real threats to our security and our economy."

The building pinpointed as hacking HQ sits in Shanghai's northern suburb of Gaoqiao, near a petrochemical complex and surrounded by small shops, including a hair salon.

There is no nameplate outside but framed posters showing soldiers are displayed on a high wall surrounding the complex, while the Chinese PLA's symbol of a red star is mounted over the main door of the building.

One soldier in camouflage uniform stood at the main gate on Tuesday, an AFP correspondent saw, while another wearing a PLA overcoat was stationed in the guard house, close to a sign reading "No photography" in both English and Chinese.

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British PM vows to co-operate with India

British PM David Cameron David Cameron has arrived in India for a three day visit. Source: AAP

EDS: includes press statements

By Adam Plowright

NEW DELHI, Feb 19 AFP - British Prime Minister David Cameron has promised full cooperation with an Indian investigation into alleged corruption in a helicopter deal, an issue which has clouded his trip to New Delhi.

Cameron arrived in India on Monday with what he called the biggest-ever British overseas business delegation, pushing for better access to the booming market of 1.2 billion people and greater trade.

While keen to persuade India of the merits of the part-British Eurofighter jets, he has been dogged by another aviation deal involving the Anglo-Italian helicopter maker AgustaWestland.

Italian authorities made arrests last week during an investigation into bribes allegedly paid to secure the $US750 million ($A732.03 million) Indian government contract in 2010.

Press leaks indicate one of the accused middlemen is based in London.

The helicopters are being made in southwest England.

"We will respond to any request for information. I am glad that the Italian authorities are looking into this issue in detail," Cameron told a press conference with Indian counterpart Manmohan Singh.

Singh, eager to show his graft-plagued government taking action ahead of general elections next year, said he had conveyed "our very serious concerns regarding allegations that unethical means were used" to secure the deal.

"I have sought the full assistance of the UK in this case," he added.

The scandal has been an unwanted distraction for Cameron who is eager to forge a new partnership with Britain's former colony, believing their historical links should provide a foundation for a closer partnership.

Like other European leaders who arrive eyeing the country's enviable economic growth rates, he is keen for British companies to benefit from India's vast investment in infrastructure, health, energy and defence.

Executives in his delegation from the worlds of banking, insurance and retail have also been encouraged by the Indian government's moves late last year to drop some barriers to foreign investors.

Cameron has targeted a doubling of annual bilateral trade with India, from STG11.5 billion ($A17.39 billion) in 2010 to STG23 billion by the time he faces re-election in 2015.

In a bid to address Indian concerns about his government's drive to slash immigration to Britain, Cameron announced on Monday a new same-day visa service for Indian business people.

He also stressed again on Tuesday that there was "no limit" on the number of students who can study at British universities providing they have an offer and an English-language qualification.

Singh thanked Cameron for "strong personal commitment to India" - this is his second visit since becoming prime minister in 2010 - and said he had invited increased British investments in India.

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Troops pour into Syria's Aleppo

President Bashar al-Assad says he's confident his troops will win the conflict ravaging Syria. Source: AAP

HUNDREDS of troops backed by military vehicles poured into the northern province of Aleppo following rebel advances and as a battle raged for control of Syria's second-largest airport, a watchdog said.

The reinforcements arrived at the town of Tal-Aran in the southeast of the province, the Syrian Observatory for Human Rights said.

Tuesday's deployment follows unexpected advances by the rebels in their thrust to seize control of air bases in northern Syria and to capture Aleppo's international airport.

"A large number of troops are currently approaching Aleppo from the east, redeployed from central Syria, to keep the rebels from taking the country's second-biggest airport," said Observatory director Rami Abdel Rahman.

"The army will not let Aleppo international airport go without a big fight."

In the past week, rebels have captured air bases at Al-Jarrah, Hassel and Base 80, as well as an important checkpoint near the international airport.

On Monday, they made a brief incursion into the airport's fuel warehouse before the army pushed them out, a military source said.

The source also said the rebels had seized a building strategically located 200 metres from the airport.

Fighting between rebels and troops also erupted Tuesday in southern Damascus, where the army deployed reinforcements in a bid to drive insurgents out of belts surrounding the capital, the Observatory said.

"Rebels and regular troops clashed at the entrance to Yarmuk (Palestinian) refugee camp in Damascus," said the watchdog.

Pro-regime daily Al-Watan at the same time reported "clashes near Sayyida Zeinab (southeast of Damascus) and the surroundings of Yarmuk camp".

The camp housing thousands of Palestinian refugees has seen fierce fighting inside and outside its premises since late last year.

Throughout much of the winter, the army has been engaged in a bid to keep approaching rebels out of Damascus, making daily attacks on their enclaves all around the capital.

But in Damascus province, as in much of the rest of the country, rebels and the army have reached a military stalemate, said Abdel Rahman.

"Across Syria today, there are hundreds of flashpoints. Both the army and the rebels are over-stretched," he said.

"While the rebels have made significant advances in some areas such as Aleppo province, the army is not going to let any strategic area slide. So what we are looking at is a long-term war of attrition."

The United Nations says that nearly 70,000 people have been killed in the Syrian conflict.

On Monday at least 154 people were killed in violence across Syria, among them 63 soldiers and 54 rebel fighters, said the Observatory.

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South Korea flexes might with naval drill

SOUTH Korea staged a naval exercise involving US surveillance aircraft, flexing its military muscles at a time of high tensions on the Korean Peninsula following the North's third nuclear test.

Day one of a six-day drill in the East Sea (Sea of Japan) involved South Korean warships and submarines, as well as surveillance planes from the United States, the defence ministry in Seoul said on Tuesday.

The exercises will practise operations to detect and track North Korean missiles and submarines, the ministry added.

"The drill is aimed at testing our readiness against threats from the enemy."

It is the latest in a series of military exercises, which have been staged alone by South Korea or jointly with the United States since the North launched a long-range rocket on December 12.

Earlier this month Seoul and Washington conducted a joint naval exercise with a US nuclear submarine off South Korea's east coast, followed by a joint air force drill.

Pyongyang insists the December launch put a satellite into orbit for peaceful research, but critics said it amounted to a banned ballistic missile test that marked a major advance for the communist state's nuclear weapons program.

Following the North's nuclear test on February 12, the South vowed to accelerate the development of longer-range ballistic missiles and new cruise missiles capable of a precision strike on members of Pyongyang's high command.

North Korea said the test - widely condemned by the international community - was a direct response to UN sanctions imposed on Pyongyang after last year's rocket launch.

South Korea's outgoing President Lee Myung-Bak said Pyongyang was drawing closer to "a dead-end" by inviting isolation and sanctions from the international community.

"Though North Korea is congratulating itself on the success of the test, neither nuclear power nor missiles will protect them," he said in a farewell speech on Tuesday.

Lee will leave office next week.

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Stranded Sydney boat to be towed

Four people have been rescued from a fishing boat that became stranded on rocks in Sydney's south. Source: AAP

SALVAGE crews will try to refloat a 50-foot trawler that became stranded off a beach in Sydney's south.

The fishing boat, Challenge, ran onto rocks near Cronulla beach after midnight on Monday.

Four Indonesian crew members tried to escape the choppy waves on a small boat before marine officers rescued them.

A salvage team have attached lines to the stern of the vessel which is expected to be towed about 4am (AEDT) on Wednesday, Sydney Ports marine service manager Phillip Holliday told AAP.

He said the boat is in good condition and no fuel has leaked so far.

"We're pretty confident it will be towed off. If things don't go as well we'll reassess from there," Captain Holliday said.

High tide is expected at 5am (AEDT) and it's expected the refloat will take several hours.

Captain Holliday said a salvage team, water police and volunteers from the State Emergency Service will stay at the scene overnight to maintain an exclusion zone.

Curious locals watched the spectacle from the Esplanade on Tuesday.

An investigation is under way into why the trawler ran aground.

"It looks to be a sound vessel, so how did it end up sitting there? It's not supposed to be there - so what went wrong?" Captain Holliday said.

The crew are being questioned.

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