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Terror arrests in Australia over planned Anzac Day attack

[SYDNEY] Two men were arrested in Australia on Saturday for allegedly planning an Islamic State-inspired terrorist attack using "edged knives" on a ceremony commemorating Anzac soldiers who have fought and died for their country.

Seven search warrants were executed in Melbourne by a joint counter-terrorism team, two months after Prime Minister Tony Abbott warned the threat from home-grown extremists was worsening.

Police said two 18-year-olds were held over terrorism-related offences.

"It is alleged both men were undertaking preparations for planning terrorist acts in Melbourne, which included targeting police officers," Victoria state and federal police said in a joint statement.

"Part of their alleged planning included targeting an Anzac Day ceremony." Ceremonies are due to be held in towns and cities across the country on April 25 to remember those who served and died as Australian and New Zealand Army Corps soldiers - the country's most important national occasion.

This year's events have assumed added significance with the day marking a century since the bloody World War I Gallipoli campaign in what is now Turkey.

More than 60,000 Australian and New Zealand troops joined an Allied expeditionary landing on the peninsula in 1915, and 11,500 of them never returned.

The arrests also come just days after Australia began deploying 330 more troops to Iraq for two years to train local soldiers fighting jihadists including the Islamic State group, joining an aerial and special forces contingent in the region.

A third man held in Saturday's raids, also 18, was arrested on weapons charges with two other teenagers, aged 18 and 19, in custody and assisting with enquiries.

Police said was it believed the attacks would have involved "edged knives", reportedly including a sword, although there was no direct evidence to suggest a beheading, a killing method favoured by jihadists.

"At this stage we have no information that it was a planned beheading. But there was reference to an attack on police," Victoria Police Acting Deputy Commissioner Shane Patton told a news conference.

"Some evidence that was collected at a couple of the scenes and some other information we have leads us to believe that this particular matter was ISIS-inspired." ISIS is another name used to refer to the Islamic State group.

The Age newspaper said the men arrested were "associates" but not relatives of Numan Haider, who was shot and killed by counter-terrorism police in September last year in Melbourne.

Australian Federal Police Acting Deputy Commissioner National Security Neil Gaughan said the arrests demonstrated that authorities would respond quickly to disrupt any alleged terrorism plans.

"We make no apologies for undertaking pre-emptive action to prevent violent and unprovoked attacks from taking place," he said.

"As has been the case in similar operations in recent times, early disruptive activity continues to be a key strategy to keep the community safe." Australia raised its threat level to high last September and has since carried out a series of counter-terrorism raids, with alarm fuelled by the departure of at least 110 of its nationals to Iraq and Syria to fight with the Islamic State group.

More than 30 have returned to Australia.

A string of incidents, including a December siege in a Sydney cafe by a self-styled cleric who attempted to link his actions to Islamic State, have raised awareness about radicalisation among Muslims in Australia.

In February, two men were charged after police thwarted an "imminent" attack in Sydney, seizing an Islamic State flag, a machete and an Arabic-language video detailing the alleged plot.

The same month Mr Abbott, in a national security address, warned of a long-term era of heightened threats from "home-grown" extremists as he announced fresh measures to combat the issue including revoking citizenship for dual-nationals linked to terrorism.