CAIRO, Egypt — Kidnappers released a video to show Iraq's latest foreign hostage — an Australian national married to an American and living in the San Francisco area. Douglas Wood, 63, was shown seated between two masked people pointing automatic weapons at him.

His wife, Pearl, told The Associated Press the tape showed her husband, who appealed to President Bush, Australian Prime Minister John Howard and California Gov. Arnold Schwarzenegger to order coalition forces out of Iraq to save his life.

She said he had been in Iraq for 1 ½ years, working as an engineer.

A sign on the tape carried the name of the group responsible for the kidnapping, Shura Council of the Mujahedeen of Iraq. The group previously has claimed responsibility for attacks on U.S. soldiers and Iraqi forces, plus the kidnapping of Turkish national Aytullah Gezmen, who was freed in September.

The tape was broadcast on Al-Jazeera television and obtained by Associated Press Television News.

About 2,000 elite Australian troops took part in the U.S.-led invasion; 920 troops still remain in or around the country.

More than 200 foreigners have been kidnapped since Saddam Hussein's regime collapsed in April 2003. Some kidnappers have sought ransom, while others pursued political motives, such as the withdrawal of foreign companies and troops from Iraq. More than 30 hostages have been killed.

Also yesterday:

Case of slain aid worker: The British Foreign Office, meanwhile, announced three arrests in the abduction of Margaret Hassan, the director of CARE International in Iraq, believed to have been slain last year. Her body has not been recovered. U.S. and Iraqi forces have found items apparently related to Hassan, the British Embassy in Baghdad said.

Killing by U.S. soldiers: The Italian government said its report on the killing of an Italian intelligence agent by U.S. soldiers in Baghdad would show problems of coordination with authorities in Iraq and with rules of engagement for checkpoints. The Foreign Ministry in Rome said the Italian report will be made public today, providing its own version of the March 4 "friendly-fire" shooting death of agent Nicola Calipari, who had just won the release of an Italian hostage, journalist Giuliana Sgrena.

Iraqi official predicts U.S. troops will leave

WASHINGTON — U.S. and other foreign troops in Iraq will likely start pulling out in large numbers by the middle of next year, Iraq's national-security adviser said yesterday.

"I will be very surprised if they (U.S. and other foreign troops) don't think very seriously of starting pulling out probably by the end of the first half of next year," said Iraqi national-security adviser Mowaffak Al-Rubaie in an interview with CNN's "Late Edition."

When pressed on exact numbers expected to leave, Al-Rubaie said this depended on how quickly Iraqi troops could be trained and armed to take over.

Twenty-five months after the invasion to topple Saddam Hussein, the United States has 138,000 troops in Iraq battling a relentless insurgency and training Iraqi security forces.

The United States has not given a timetable for withdrawing its troops, and President Bush has said repeatedly that U.S. soldiers will leave only when Iraqi forces can take over.

Report urges Iraq be split into states

BAGHDAD — Iraq should consider splitting itself into five or six federal states under a single national government to give Iraqis greater management of their own affairs, a new report by a U.S. academic suggests.

The division should take place along geographic not ethnic lines, and Baghdad should be one of the states, argues the report by a senior fellow at the U.S. Council on Foreign Relations, an independent think tank.

"Iraq's elections on Jan. 30, 2005, were a watershed in the country's history. Still, democracy involves much more than voting," David Phillips says in his analysis, "Power-sharing in Iraq."

Phillips, a former adviser to the U.S. government, suggests two or three states be formed from nine southern and central provinces, where the population is mostly Shiite Muslim, and another state be crafted from four central and western provinces that are predominantly Sunni.

Another would be carved from the three mainly Kurdish provinces in northwestern Iraq, and Baghdad would stand alone.

Iraq sits on the world's third largest oil reserves, but production is based in the far south and around the northern city of Kirkuk. The central region has no natural oil resources.