SARAJEVO, May 15 (Reuters) - A plan by Bosnian Serb war veterans to build a church on the heights above Sarajevo in memory of comrades killed in the 1992-95 war seems set to deepen divisions between Bosnia's two autonomous regions.

The association of Serb war prisoners originally planned to erect a giant cross on Trebevic hill, from where the Bosnian Serb army shot down into the capital during the 43-month siege, which killed more than 11,000 people.

That idea stirred public outrage in Sarajevo and was not supported by the Bosnian Serb leadership. But a new plan to build a Christian Orthodox church at the same site won the support of Bosnian Serb leaders this week.

"This church will be a symbol of the Serb calamity in Sarajevo," said Branislav Dukic, head of the association behind the idea.

Dukic said the names of 6,200 Serbs killed during the Sarajevo siege would be engraved in the church, to be built near the line separating the Muslim-Croat federation and the Serb Republic, Bosnia's two autonomous regions.

The Serb Republic government pledged to finance the plan.

But Sarajevo mayor Semiha Borovac warned against construction of religious buildings on the heights from which the people of the capital were shelled and shot by snipers.

"I believe the building of a church will not improve reconciliation between Bosnian peoples," Borovac said in a statement to Reuters.

She added that the previous plan to erect the cross on Trebevic hill had been dismissed as a provocation by both the local and the international community.

But Serb Republic Prime Minister Milorad Dodik said his government would persevere in providing support to all organisations striving to establish the truth about wartime Serb suffering in the Bosnian capital, now predominantly Muslim.

MEMORIES OF WAR

Bosnia's two ethnic regions were stitched together under the 1995 Dayton peace accords in an uneasy alliance. Memories of war heavily burden relations among Muslims, Serbs and Croats.

Sarajevo's plight became synonymous with the war, as the world watched television images of Serb artillery, mortar and sniper fire raining down on the helpless city from above.

Miro Lazovic, a Serb who lived through the siege, said the church move was linked to local elections due in October.

"Religious objects must not be used as a seed of separation or for political instrumentalisation," he told the daily Dnevni Avaz.

"Dodik should leave the Serb calamity to history instead of using it for own political ends. Most Sarajevo Serbs were killed by Radovan Karadzic's army, which pounded the city with shells from that hill," he added.

Bosnian Serb wartime leader Karadzic and his military chief Ratko Mladic are indicted by the United Nations war crimes tribunal for the siege of Sarajevo and the 1995 Srebrenica massacre of up to 8,000 Muslims. Both remain at large.

The tribunal has so far convicted two Bosnian Serb generals of war crimes and crimes against humanity for ordering the blockade of Sarajevo. (Additional reporting by Mirna Soja; editing by Douglas Hamilton and Andrew Roche)