By ROBERT BURNS, AP National Security

MANAMA, Bahrain – U.S. Defense Secretary Robert Gates said Saturday he believes leaders in Persian Gulf ally Bahrain are serious about addressing grievances that have spawned a growing protest movement, but swift action is needed to deny rival Iran the chance to exploit the current instability.
Gates told reporters on his flight home from the Mideast that he urged rulers in the kingdom, which is home to the U.S. Navy's 5th Fleet, to view their crisis as a chance to show other Arab governments how political change can prove successful.

"I told them that in this instance, time is not our friend" in light of Iran's interest in capitalizing on the unrest, the Pentagon chief said in an interview after meetings in Manama, the capital.
"We have no evidence that suggested that Iran started any of these popular revolutions or demonstrations across the region, but there is clear evidence that as the process is protracted — particularly in Bahrain — that the Iranians are looking for ways to exploit it and create problems," Gates said.

Gates offered no examples of that. But a senior defense official traveling with Gates said U.S. intelligence has evidence that Iran is working to persuade some hard-line Shiite opposition figures in Bahrain to reject the government's offer to begin a political dialogue on how to address a range of grievances.

The senior official spoke on condition of anonymity to discuss sensitive intelligence information.
Iran, a Shiite power in the region, is seen by Sunni-led countries such as Bahrain and Saudi Arabia as a serious threat.
Coinciding with Gates' visit, tens of thousands of protesters encircled one of the royal family's palaces west of the capital, demanding political freedom and the king's ouster.

A similar march south of Manama on Friday met with a violent response from security forces. But there was no repeat Saturday.
Bahrain's monthlong uprising has deepened the sectarian divide between Sunni Muslims backing Bahrain's ruling dynasty and the Shiite protesters demanding it give up its monopoly on power.

Shiites — about 70 percent of the population — have long sought rights equal to those of the nation's Sunnis and the naturalized Sunnis from Arab states. The current political unrest is unprecedented, though tensions have simmered for years.
Gates held talks with King Hamad bin Isa Al Khalifa and Crown Prince Salman bin Hamad Al Khalifa. The king has assigned the crown prince to lead talks with the political opposition and ordered the creation of 20,000 government jobs.

In remarks to Gates, with reporters standing nearby, the crown prince said the protesters should respect the views of the Sunni side.
"There is another point of view in the country that a significant portion of the electoral base feels that their voice is unheard and they want the respect due to them to be given to them by the opposition," he said. "They want to sit and talk with them."

It was Gates' final stop on a weeklong trip that took him also to Afghanistan, Germany and NATO headquarters in Brussels, where he warned allies against a precipitous withdrawal of troops from Afghanistan.
On the flight to Washington, Gates said he came away encouraged by prospects for avoiding further instability in Bahrain, just one of the countries in the Arab world experiencing protest movements that began in January and have toppled longtime rulers in Egypt and Tunisia.

Gates said he was convinced that Bahrain's king and crown prince "are serious about real reform," he said.
He spoke sympathetically of the king's complaint that he was having a hard time getting the Shiite opposition to hold talks on prospective political reforms. He described them as being "between a rock and a hard place." But at the same time, Gates said he pressed his argument that half-measures would fall short.
"Baby steps probably would not be sufficient" to resolve the grievances being expressed by protesters in Bahrain, he added.

The turmoil in Bahrain poses a special challenge for the Obama administration because of the strategic importance of this island nation as host to the 5th Fleet and the prospect of increased Iranian influence as a regional Shiite power.

There also is concern about how further instability in Bahrain could affect Saudi Arabia, whose authoritarian monarch already is facing a measure of popular unrest.
Gates said he told Bahrain's leaders that they and rulers elsewhere in the Arab world face a stark choice: lead the way toward real democratic change or have it imposed upon them by popular revolt.

"I told both the king and the crown prince that across the region I did not believe there could be a return to the status quo," he said. "Obviously leading reform and being responsive is the way we would like to see this unfold."
Asked about the prospect of instability leading to the ouster of the 5th Fleet from its decades-long headquarters, Gates said he saw little immediate chance of that.
"I don't see any evidence that our (military) presence will be affected in the near- or middle-term," he said.