Iraq's future depends as much on the fate of Najaf as on the conference in Baghdad

When Iraq's interim government, on the advice of the United Nations, postponed the planned national conference last month, it was because there were hopes that the security environment would improve. As the 1,300 delegates finally convened yesterday, however, it was clear that not one of the conflicts simmering at the time of the 30 June transfer of sovereignty had been resolved. On the contrary, previous hostilities had flared up, the violence has spread and the risk of an all-out Shia revolt across the south has only been heightened.

When Iraq's interim government, on the advice of the United Nations, postponed the planned national conference last month, it was because there were hopes that the security environment would improve. As the 1,300 delegates finally convened yesterday, however, it was clear that not one of the conflicts simmering at the time of the 30 June transfer of sovereignty had been resolved. On the contrary, previous hostilities had flared up, the violence has spread and the risk of an all-out Shia revolt across the south has only been heightened.

In these circumstances, the opening of the national conference yesterday, on time to meet its delayed schedule, can be considered either a small triumph or a foolhardy refusal on the part of the Prime Minister, Iyad Allawi, to accept reality. Whichever is correct - and it may be a bit of both - it is certainly preferable for all involved that the next stage in the envisaged electoral process proceed, however unrealistic the timetable for elections may seem at present.

Elections were one of the earliest promises made by the occupying powers. The prospect of elections is one of the few pillars supporting the fragile credibility of Mr Allawi. Were the timetable to slip, or be abandoned, Iraqis would lose any remaining hope of advance towards "representative government" - the term now favoured as more realistic than "democracy". They would lose any faith in normalisation, and the consequences could be dire.

That the conference has convened is therefore a positive development. Nor is it necessarily a waste of time if, as happened yesterday, many speakers spend their allotted time denouncing the violence in the holy city of Najaf and warning of the dire consequences if it were to escalate further. Their voices may have contributed to the appeal issued by the Iraqi government yesterday to all forces in the city to refrain from attacking the shrine. If the conference concludes tomorrow with the selection of an interim council entrusted with making preparations for elections, this will be a measure of progress.

The omens, though, are not good. Only a broad security cordon and a 15ft-high concrete barrier protected conference delegates yesterday from a series of mortar attacks. The extent to which Mr Allawi is in control even of his capital, with or without the support of foreign troops, is questionable. In Najaf, fighting resumed yesterday after talks on a truce broke down, and there is no guarantee that the Iraqi government's call for the shrine to be spared will be heeded. One spark, and not only the shrine, but the whole of southern Iraqi, could be set alight.

The stand-off in Najaf also highlights the chief defect of the national conference. For all the efforts to make it representative of Iraq's diversity, at least one swathe of political and religious opinion is missing: the one represented by the radical Shia cleric, Muqtada Sadr, in Najaf. More ominous, perhaps, is the fact that the more beleaguered the Mehdi army has become and the more ferocious the assaults against it, the more hitherto moderate Shias have been drawn to Sadr's cause and the less reason they see to compromise.

The fate of Najaf and the fate of the electoral process - arguably the gateway to Iraq's peace and long-term prosperity - are thus intimately linked. This is why President Allawi, and the Americans, went to such lengths to try to end the conflict with Sadr and his forces one way or the other before this weekend. It is also why the absence from the political scene, through illness, of the moderate Shia leader and erstwhile intermediary, Ayatollah Sistani, is so untimely. If ever a restraining influence was needed, it is now.

Hopes that the handover of sovereignty and, with it, the lower visibility of foreign troops would bring calm to Iraq have proved vain. The violence is too entrenched, and Iraqi is now pitched against Iraqi. The fight for Najaf is nothing less than a battle - the battle, perhaps - for Iraq's future.