The US government faced fierce pressure to get tough with Vietnam over religious freedom, as a congressionally mandated rights watchdog branded a key trade pact with Hanoi, which supporters said would ease abuses, a failure.
Secretary of State Colin Powell should immediately nominate Vietnam a "country of particular concern" (CPC) on freedom of worship -- a move which could lead to sanctions, the US Commission on International Religious Freedom (USCIRF) said.
The move came as Catholic priest Nguyen Van Ly, arrested after offering testimony to the commission two years ago, languished in prison in Vietnam, and followed what critics say is a Vietnamese crackdown on religions.
"This blatant disregard of the most basic human rights makes clear why Vietnam should be immediately designated a CPC," said Commission Chairman Michael Young.
Young also criticized a historic US-Vietnam trade pact which went into force nearly two years ago, a high point in relations between the former wartime foes, which supporters said was certain to promote economic and political opening.
"We were assured by supporters of that act that as Vietnam was more deeply integrated with the US economically, it would bring the dawn of a new day," for human rights in the country, Young said.
"It is clear to us the situation has deteriorated."
That call was taken up by Congressman Chris Smith, a noted human rights advocate, who argued that by granting a historic tariff-slashing trade deal with Vietnam, Washington had ceded leverage over its human rights record.
"The human rights situation in Vietnam continues to deteriorate, especially in the light of the bilateral trade agreement," said Smith.
"It has been a dismal failure."
The State Department has condemned the jailing of Ly, and criticized Vietnam over other recent human rights violations but so far declined to designate it a country of particular concern.
There was no immediate reaction from the department to the USCIRF calls on Wednesday.
Such a move would hamper US-Vietnam trade links and, as a result act as a disincentive for Hanoi to loosen controls over society, say opponents, many of them in the business lobby.
Washington last week flung a sharp rebuke Hanoi's way after three dissidents, all relatives of Father Ly, were jailed for contacting US-based opposition activists.
Sentences handed down on Nguyen Vu Viet, 27, Nguyen Truc Cuong, 36 and their sister Nguyen Thi Hoa, 44, contravened international norms, the State Department said.
Father Ly, 57, was placed under house arrest in March 2001 a month after giving written testimony to USCIRF, which was set up by Congress to provide policy advice to government.
He was sentenced to 15 years in jail in October 2001. In a move seen as an attempt to appease human rights critics, a court reduced the sentence to 10 years in July.
USCIRF also supports legislation introduced in July in the US Congress which seeks to cap non-humanitarian aid at 2003 levels unless Vietnam meets a series of human rights benchmarks.