June 29 (Bloomberg) -- Pakistan’s Prime Minister Yousuf Raza Gilani said there will be no talks with militants because the army is taking decisive action against them “in a guerrilla fight” in the tribal region and in the Swat Valley.

“Our army is fighting very efficiently against cowardly people,” the state-run Associated Press of Pakistan cited Gilani as saying in Lahore yesterday. It’s not the time for dialogue with terrorists, he said.

Pakistan’s army is engaging Taliban forces in the Federally Administered Tribal Areas bordering Afghanistan after an offensive that began in April in nearby Swat. The U.S. is pressing Pakistan to tackle Taliban and al-Qaeda fighters operating in the region, and President Barack Obama has said an aid package to Pakistan worth $1.5 billion a year is conditional on the government cracking down on extremists.

Eight guerrillas were killed in Swat and 10 in Waziristan, in operations that destroyed the militants’ command network and led to the seizure of “a huge amount” of arms and ammunition, army spokesman Athar Abbas told reporters today. Sixteen soldiers have been killed in the past 24 hours, he said.

Twelve of the soldiers died in the North Waziristan tribal area yesterday when their convoy was hit by an explosive device, APP reported, citing the military.

Taliban Commander

The army is preparing an offensive against Taliban leader Baitullah Mehsud in South Waziristan, where U.S. military analysts estimate he commands as many as 5,000 fighters.

Local newspapers yesterday published advertisements announcing rewards totaling $1.6 million for information leading to the capture of Mehsud and 10 other commanders, the Dawn newspaper reported. Dawn said it couldn’t confirm whether local government authorities placed the advertisements.

Mehsud escaped a suspected U.S. drone attack last week on a funeral procession for a militant commander, the newspaper reported at the time.

Mehsud formed Tehrik-e-Taliban Pakistan from an alliance of some five pro-Taliban groups in December 2007, according to the U.S. Military Academy’s Combating Terrorism Center at West Point. The U.S. has offered a $5 million reward for Mehsud, saying his forces have attacked coalition troops in Afghanistan.

The army began its offensive in the Swat Valley in North West Frontier Province in April after the Taliban advanced to within 100 kilometers (62 miles) of the capital, Islamabad, violating an accord to end fighting in return for the government placing the region under Islamic law.

The military says more than 1,600 militants have been killed since the operation began. An estimated 2.5 million civilians have fled the fighting in Swat, the biggest exodus in Pakistan since the country was founded in 1947.

Soldiers in the region yesterday captured three terrorists, including a trainer of suicide bombers, APP reported, citing the military.

To contact the reporters on this story: Paul Tighe in Sydney at ptighe@bloomberg.net; Farhan Sharif in Karachi, Pakistan, at o Fsharif2@bloomberg.net.

Last Updated: June 29, 2009 10:04 EDT