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By Mica Rosenberg and Gustavo Palencia
TEGUCIGALPA (Reuters) - The de facto Honduran government relaxed curbs on protests and media on Monday but toughened criticism of ousted President Manuel Zelaya as talks to end a three-month political crisis stalled.
Talks to resolve the crisis sparked by Central America's first coup in more than a decade sputtered with both sides stuck on the question of whether Zelaya can return to the presidency ahead of a November election.
Zelaya's camp said late on Monday it would not return to the debating table until the de facto leadership produces a more serious proposal for a solution.
"The dialogue has been obstructed," Zelaya told Reuters in a phone interview from his base in the Brazilian embassy.
Tensions have run high in Honduras since Zelaya, forced into exile by a June 28 army coup, slipped back into the country last month and took refuge in the Brazilian embassy.
The de facto government of Roberto Micheletti, installed by Congress after the coup, sent troops to surround the building, imposed curbs on press freedoms and banned large marches.
Micheletti finally carried out a promise on Monday to lift the emergency restrictions on freedoms but Zelaya's negotiating team accused him of playing for time so he can stay in power until the presidential election scheduled for November 29.
"Micheletti has not shown any political will," said Zelaya envoy Victor Meza. "He is using the talks as a distraction tool to win time. He is trying to drag out the process with inadmissible and insulting proposals."
The United States and Latin American nations have insisted Zelaya be reinstated but the coup backers say he has legally been stripped of his powers and cannot come back.
Micheletti's lead negotiator Armando Aguilar said his team presented a proposal asking the Supreme Court and Congress to submit official opinions on Zelaya's reinstatement.
The Supreme Court, together with a near unanimous vote in Congress, was the body that ordered Zelaya's June ouster, however. The court argued he violated the constitution by seeking to allow presidential re-election and the two institutions are seen as unlikely to side with him now.
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The coup brought back memories of Central America's ugly past of civil wars and state-backed violence in the 1970s and '80s and created a foreign policy headache for U.S. President Barack Obama, who has pledged better relations with Latin America.
A failure to restore Zelaya to office could put the November election at risk if foreign governments who have condemned the coup refuse to recognise the result.
At a recent meeting in Bolivia, leftist Latin American allies of Zelaya called for tighter international sanctions. Zelaya angered business leaders at home by becoming close to socialist Venezuelan President Hugo Chavez.
Zelaya said he had no plans to leave the embassy where he is camped out with supporters and a handful of journalists. Micheletti says he will be arrested if he sets foot outside.
"I will just leave one room and go to another until we find some way out of this situation," Zelaya told Reuters.
He called on the Organisation of American States, which launched the latest round of talks, to step up pressure on the de facto government.
Foreign donors have pulled millions of dollars of aid from coffee-exporting Honduras, one of the poorest nations in Latin America, but Zelaya says it is not enough.
Some in Honduras' Congress criticized Micheletti's emergency decree curbing civil liberties and human rights groups accuse his government of major abuses, including deaths.
Micheletti promised to lift the measures on October 5 after strong international condemnation, but the executive order was only finally overturned in the official gazette on Monday.
A pro-Zelaya radio station and a television channel, both of which had their offices closed down and raided by masked soldiers after the decree, went back on the air.
But Micheletti's government justified the action even as it was reversed, saying it stopped pro-Zelaya protests. "Their objective was not just to protest but to commit crimes, destroy business, assault banks and supermarkets," said a statement.
(Additional reporting by Adriana Barrera, Ines Guzman and Frank Jack Daniel; Writing by Mica Rosenberg; Editing by Bill Trott)

Reuters