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Australia's Prime Minister Kevin Rudd says his government will do all it can to safeguard democracy in East Timor after attacks on its president and PM.

On his second visit to East Timor in only two months, Mr Rudd said his support was "absolutely rock solid".

President Jose Ramos-Horta was seriously hurt in Monday's shooting, and is being treated in Australia.

Canberra deployed an additional 350 peacekeepers to Dili in the immediate aftermath of the attacks.

In a three-hour visit, Mr Rudd held talks with Prime Minister Xanana Gusmao, who narrowly escaped injury when gunmen ambushed his car on Monday.

"The purpose of my visit today is to state in clear and loud terms that Australia will stand shoulder to shoulder into the future in the defence of East Timor's democratic system of government," Mr Rudd told a press conference.

"Australia is here for the good times, the bad times and the difficult times."

Australian troops - who now number about 1,000 - would remain in East Timor for as long as they were needed, he said.

The two leaders also discussed East Timor's long-term economic challenges - such as its weak infrastructure and soaring unemployment.

"Ensuring young people across Timor-Leste (East Timor) have a job is for business, but also this country's long-term stability," Mr Rudd said.

Mr Gusmao thanked Australia for its rapid response to Monday's events and its faith in the country's development.

"Our nation is a proud nation," he said. "A bullet can wound the president but can never penetrate the values of democracy."

Rebel leader

The situation in Dili has remained calm since Monday, despite fears of protests. A state of emergency declared by Mr Gusmao remains in place.

Several arrest warrants have been issued in connection with the attacks, which have been attributed to a group of rebels soldiers with grievances that date from a wave of violence in mid-2006.

Australian-led international forces are now combing the hills behind the capital for the remaining rebels.

Their leader, Alfredo Reinado, was killed in the attack on Mr Ramos-Horta's residence.

But in a BBC interview on Thursday, one of the rebels involved in the attacks, Gastao Salsinha, denied attempting to assassinate the two top leaders.

He said security personnel for President Ramos-Horta started the fire fight that killed Reinado.

Speaking from hiding, Mr Salsinha said he had now taken over as rebel leader.

East Timor won independence in 2002 after decades under Indonesian rule.

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