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* Biggest attack in nearly a year
* Blaze visible, gunfire, explosions heard across city
* Fighters holed up in shopping centre
By Hamid Shalizi and Sue Pleming
KABUL, Jan 18 (Reuters) - Taliban gunmen, some wearing suicide vests, launched a commando-style assault on government buildings in the centre of Kabul on Monday, underscoring the perilous security situation in the Afghan capital.
It was the worst attack on the city in nearly a year. Gunfire and loud explosions could be heard across the capital and a huge column of smoke was pouring out of a shopping centre that was at the heart of the attacks.
By mid-day, the main attack on the presidential palace and ministries in the centre of town seemed to have been repelled, with fighters now holed up inside the shopping centre, that was on fire and surrounded by Afghan police and security officials.
While the gunbattle there was underway, a suicide car bomber exploded his vehicle outside another shopping centre nearby killing several police and security officials, a security source said. Another blast was later reported near a cinema several hundred metres (yards) away.
The Taliban said 20 of their fighters were involved in the attacks, which targeted the presidential palace, justice ministry, ministry of mines and a presidential administrative building, all clustered in the centre of town.
It was not immediately clear how many were killed, but the apparent ease with which the militants penetrated the heart of the city underlines the challenges facing President Hamid Karzai.
It also appears to be a slap in the face for his new initiative to lure Taliban fighters to lay down their arms that he plans to announce at an international conference in London this month.
The initiative is a key part of U.S. President Barack Obama's new strategy, which will also see 30,000 extra troops sent to turn the tide against a mounting insurgency.
The strikes came as some members of Karzai's new cabinet were being sworn in after an election last year.
Initial reports of casualties were only partial. NATO forces said at least two armed insurgents were killed. A security source said two guards were shot dead by the bombers as they stormed the Grand Shopping Centre. Another said three people had died.
The attack was the biggest in the capital since fighters stormed the justice ministry and other government buildings last February. Taliban fighters have long had their sights on Kabul, staging a number of smaller bomb attacks in recent months in the city, and have mounted similar commando raids in other cities.
A police source said one suicide bomber may have penetrated the justice ministry. However, there were no confirmed reports that fighters had successfully managed to seize any of the government buildings they had aimed for.
Defence Ministry spokesman Zaher Azimy said of the scene at the Grand Afghan Shopping Centre: "The store is under siege and we are involved in a clash with those inside. Some security forces have managed to get inside the store."
Mohammad Shah, a shopkeeper in the centre, said: "There was an explosion at the presidential palace gate and then three people who looked like suicide bombers entered the shopping centre and went to the second and third floor.
"There were gunshots from security people, there was black smoke inside the building and the security guys escorted us out," he said.
The store is adjacent to the Serena Hotel, where many foreigners stay, but the hotel itself did not appear to have been targeted by the attackers.
A Reuters reporter overheard security forces saying on radio that the car bomber at the second shopping centre had driven a military ambulance, suggesting fighters may have posed as members of the Afghan security forces or infiltrated them.
Some gunmen may have been wearing uniforms, security officers said over the radio, urging that Afghan army troops be kept from the scene to prevent confusion or further infiltrations.
The NATO-led International Security Assistance Force said it was "working closely with our Afghan partners to aggressively contain the situation".
(Reporting by Sayed Salahuddin, Hamid Shalizi, Golnar Motevalli, Sue Pleming, Jonathon Burch and Emma Graham-Harrison; writing by Peter Graff; Editing by Raju Gopalakrishnan) (For more Reuters coverage of Afghanistan and Pakistan, see: http://www.reuters.com/news/globalcoverage/afghanistanpakistan) (email@example.com; Kabul newsroom: +93 799 335 285)) (If you have a query or comment about this story, send an e-mail to firstname.lastname@example.org)
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