"The handing over of PKK (Kurdistan Workers' Party) leaders to Turkey is a dream that will never be realised," Jalal Talabani, himself a Kurd, told a news conference in Arbil, the capital of Iraq's autonomous Kurdish region.

Turkish Prime Minister Recep Tayyip Erdogan has threatened an incursion into Iraq unless Baghdad clamps down on the rebels on its territory and turns over PKK leaders.

But Talabani indicated the Iraqis would be unable to succeed where the Turkish military had already failed.

"PKK's leaders are in Kurdistan's rugged mountains. The Turkish military with its mightiness could not annihilate them or arrest them, so how could we arrest them and hand them to Turkey?" he asked.

"Handing over Kurdish leaders is a dream which would not come true."

His remarks, made alongside the president of Iraq's autonomous Kurdish region, Massoud Barzani, came as Ankara announced that 12 soldiers had been killed in clashes in southeastern Turkey that also left 23 rebels dead.

A leading PKK figure told AFP that Turkish soldiers had been captured after fierce fighting on Saturday night as they tried to "infiltrate" Iraq from Turkey's Hakkari province.

"There were clashes between the two sides. We killed a large number of them. We took a group of Turkish soldiers as prisoners," said Abdul Rahman al-Chadirchi, adding that the PKK would say how many later.

His claim was not confirmed by the Turkish military although earlier reports in Turkey said that 10 soldiers were missing.

Turkey's parliament on Wednesday approved a motion authorising military strikes into Iraq for a one-year period against PKK rebels using northern Iraq as a springboard for cross-border attacks.

A motion carried by a large majority in the Iraqi parliament on Sunday condemned that decision by its Turkish counterpart but urged its government to do more to rid the country of the PKK.

"The parliament calls on PKK fighters to leave Iraqi territories and asks the Iraqi government to take the required measures to stop PKK activities being launched from Iraqi territories," the motion said.

The motion was approved by 183 lawmakers of the 275-member national assembly.

In Ankara, Erdogan said he, President Abdullah Gul and top ministers and military leaders would meet later Sunday to decide on what action to take following the latest bloody rebel clashes.

The Turkish army has already sent additional troops to the region following the attack in which PKK rebels allegedly ambushed an infantry platoon.

Erdogan on Friday urged the Iraqi government to close "once and for all" the PKK camps, but judged "positive" recent vows by Baghdad to do so.

"What would satisfy us is the closure of all the PKK camps, including their training camps and the handover of their terrorist leaders," he was quoted as saying by the Anatolia news agency.

He also said that Iraqi Prime Minister Nuri al-Maliki had proposed joint action to crack down on the PKK rebels.

"Maliki confirmed the following thing: that if there was no result from the talks, we would carry out this operation together," Erdogan said.

Ankara claims that some 3,500 PKK fighters have found refuge in Iraqi Kurdistan and are tolerated or even actively supported by Iraqi Kurdish leaders -- a charge they strongly deny.

"We call on both sides to avoid the war, but if war broke out between them, we would not be with either of them," Barzani said at the press conference with Talabani.

The PKK has waged a bloody campaign for Kurdish self-rule in southeast Turkey since 1984. The conflict has claimed more than 37,000 lives.