Saudi Arabia is pushing ahead with plans to build a fence to block terrorists from crossing its 900-kilometre border with Iraq — another sign of growing alarm that Sunni-Shia strife could spill over and drag in Iraq's neighbours.

The barrier, which hasn't been started, is part of a $12-billion US package of measures including electronic sensors, security bases and physical barriers to protect the oil-rich kingdom from external threats, said Nawaf Obaid, head of the Saudi National Security Assessment Project, an independent research institute that advises the Saudi government.

The ambitious project reflects not only concern over terrorism but also growing alarm over the situation in Iraq, where U.S. forces are struggling to prevent sectarian violence from escalating to full-scale civil war between that nation's Shia majority and Sunni minority.

All of Iraq's neighbors, including the Saudis, fear the violence could spill over the borders and threaten their own security.

Saudi leaders worry about Sunni extremists returning home to wage war on the U.S.-allied monarchy or Shia militants trying to stir up trouble among the Shia minority.

The fence would do little to stop the flow of militants into Iraq because most are believed to cross from Syria, Jordan and Iran. U.S. and Iraqi officials have long complained about Saudi extremists joining insurgent groups in Iraq, but say they mostly go through Syria.

Obaid said the $1.8 billion US spent since 2004 on shoring up Saudi border surveillance has sharply reduced the movement of militants heading into Iraq. He said the Saudi government is most concerned now with stopping infiltration into its own territory from Iraq.

"More importantly, the main issue is to seal the border on the Iraqi side since there has been almost no [Iraqi security] presence since the U.S. invasion," Obaid said.

Other undesirables, too   

In addition to political extremists, the Saudis want to prevent drug smugglers, weapons dealers and illegal migrants from using Iraq as an avenue into Saudi Arabia, he said.

At the southeastern corner of the Saudi Arabian Peninsula, meanwhile, the United Arab Emirates is building a barrier along its border with Oman — mainly to keep out illegal migrants — just as the U.S. Congress is considering a fence for parts of the U.S. border with Mexico.

And Israel is trying to protect itself from suicide bombers by building barriers along its borders with Palestinian areas.

U.S. officials in Baghdad declined to comment on the Saudi plan, saying it was a matter between the two governments.

The spokesman for Iraq's Interior Ministry, Brig.-Gen. Abdul-Karim Khalaf, said Iraqi officials had heard of the Saudi plans to improve border security "and we thank them for it."

"If the Saudis want to build border defences to stop the infiltration of terrorists, they can do that to protect their borders," he said.

Saudi officials, who rarely comment on security matters, declined to discuss the project.

U.S. officials said in April that Saudis were among the top five nationalities among foreign fighters captured by coalition forces in Iraq. Twenty-three Saudis were arrested in Iraq between September 2005 and April, compared with 51 Syrians and 38 Egyptians, the officials said.

The Saudis are especially sensitive to the possibility of unrest among the country's Shia minority because it is centred in the oil-producing east of the country.