The outlawed, tinpot republic that is rich in Serbian dreams: Robert Fisk visits the 'Republic of Krajina', where Serbs in Croatia have declared their independence declared their independence

DON'T LOOK at the young Serb with the Kalashnikov walking drunkenly down the road towards the bridge. Imagine he's a sober policeman with a pistol in his belt. Ignore the Serbian gunman who banged on your car roof at the restaurant back in Krinjak and demanded a free lift. Forget that the United Nations civilian police officer in Vojnice told you in all seriousness that he had 'no power in the Serbian Republic of Krajina'.

Above all, pretend that the UN Protection Force in what was Yugoslavia allows only police officers and retired soldiers to mix among the civilians of Krajina - and that this is Croatia. And then meet Alexander Rebic, Serbian schoolboy and war cripple, limping into the Vojnice coffee bar and ordering an orange juice in his dirty camouflage trousers and flak jacket.

'Don't say we're occupied, whatever you write, don't say we're occupied,' he pleaded. 'I lived here all along - my family are still in Karlovac on the Croatian side. But we've got a republic of our own now and we've got to defend it. 'That's why I'm in the 'Territorial Defence Force of Krajina'. That's why I can't believe the war is over. It's not like the Croats to let things rest like this.'

Rebic stepped on a mine last year while attacking the Croatian army in Karlovac and hobbles off with his slivovitz-filled friends on his pulverised foot, an 18-year old with the gait of an old man. He had paid for his juice in Serbian Krajina dinars and waits to do battle again for the self-styled Serbian Republic of Krajina, wandering off past the police station with its new Serbian cyrillic signs, next to the kiosk with only Belgrade newspapers on sale.

Like the damp of an old church, the smell of permanence is beginning to invest the geography of the Austro-Hungarian borderlands with their crumbling castles and forested peaks and their new front lines already frozen on to the UN's maps.

Along the Korona river south of Karlovac, Croat and Serb now farm within shouting distance of each other. 'Would you believe that this is our war front?' Dragomir Cica asks with amusement as he stares out of his 'Serbian Krajina Government Information Centre' on the Slunj road. 'You can't even see soldiers here now.'

Two hundred yards away, through the mist rising off the slow waters of the Korona, a Croatian smallholder can be seen carrying a scythe along a laneway in the early morning sunlight. The Croat, of course, lives in a state recognised by the European Community. Mr Cica is standing in what the West regards as 'Serbian-occupied territory', happy to obey the pocket-size constitution of the Serbian authorities down at Knin, proudly revealing that his new nation is soon to open its first railway line. The weed-infested track between Vrginmost and Petrinja - each end of which trails off across last year's front lines into the Croatian railway system - is to be restored after a year of disuse.

How hard the Serbs here try to show their independence, even though the blue Krajina 100-dinar notes are almost identical to the blue 'Serbian Bosnian Republic' 100-dinar notes and even though the Krajina and Bosnian dinar is pegged to Belgrade's Serbian dinar.

We all know where this worthless currency is printed. In the UN's weirdly named 'Protected Area' south of Karlovac, the words fait accompli come to mind. When I drove up to a UN Nigerian roadblock, the soldier asked to search my car. But when I drove up to the UN checkpoints with a Serb irregular in my car, the Nigerians waved me through. The hordes of Serbian gunmen, with their automatic rifles and bayonets, who roam the road scarcely qualify as policemen with 'side-arms', the UN's grotesque description of these often drunken militiamen.

While Franjo Tudjman's government in Zagreb is demanding the return of Croatian refugees to Krajina - visit the ancient town of Slunj with its streets of cindered houses and you will see what they have to go home to - elderly Croats are still leaving the villages and towns of the Serbian-held land.

'It's a miserable business,' a Western humanitarian officer said with genuine regret. 'The other day, we arranged to take 10 very old Croatian families across the line. But, of course, when it came to the moment to leave, three old couples looked back at the homes they've lived in for 60 years and found they couldn't go after all. They couldn't leave their dogs and cats behind . . . so we went without them. And when we reached the other side of the line, the Croats saw there were only seven families and within hours Croatian radio was telling their listeners how armed Serbs had prevented the old Croatians from leaving.'

One Croatian woman and her baby have been allowed to cross over to Serbian Krajina - she was giving birth in Zagreb when the war cut her off from her Croatian husband - and even Serb policemen arrived to drink slivovitz when the young man embraced his child for the first time and welcomed his wife back to her Krajina home.

Yet, remarkably, the Croatian police had tried to persuade the girl not to go to Krajina. Both Serbs and Croats in Krajina express their warmth for the European Community monitors - mainly, it seems, because of their soft hearts. Many is the EC ex-soldier in spotless white who has allowed broken- hearted relatives to use the EC car- phones to call their husbands, wives and parents on the other side of the front line, quietly walking to the far end of the vehicle as the telephone receivers are bathed in tears.

But there may be far more tears to come. The Serbs fear the Croats may launch a new war to recapture Krajina, cutting the region in two and starting their offensive to coincide with any Western military involvement against Serbs elsewhere. Mr Tudjman has let it be known that he may not ask for a renewal of the UN mandate next March.

There is a political emptiness about all this which contradicts the UN's happy summaries. Down at Plitvice - to which the Krajina war spread after the Serbs' rejection of Croatian authority in Knin - the great Jezero honeymoon hotel still stands, damp and gaunt, beside the magnificent lakes that once earned so many millions of tourist dollars for the region, a fitting symbol of the hopeless prospects of Serbian Krajina's tinpot economy.

In the foyer, a massive stuffed bear greets curious visitors, mouth open, black claws ready for the kill. Dusan, Jezero's caretaker of 20 years, likes the old beast. 'The bears have always lived in these hills,' he said. 'But I haven't seen any for two months. I think the gunfire scared them off. They moved deeper into the forest.' Maybe the bears know something we do not.