BEIJING, Nov 12 (Reuter) - Chinese President Jiang Zemin has urged Tibetan lamas to speed up the search for the reincarnation of Tibet's second holiest monk after a boy recognised by the exiled Dalai Lama was excluded from a final short-list of three.

The rejection of the six-year-old Tibetan boy found by the official search team and recognised by Tibet's god-king as recipient of the spirit of the 10th Panchen Lama opens the door to rival claimants to a major reincarnation for the first time since the early 18th century.

"I hope that you will unite as one and strive to complete your work as quickly as possible to ensure stable development of Tibet," state television on Sunday showed Jiang telling a group of some 75 Tibetan monks called to Beijing last week to break the deadlock in the mystical quest.

China's communist leaders are eager to see a speedy end to the search that began with the January 1989 death of the 10th Panchen Lama, second holiest monk of the Himalayan region that has frequently erupted into anti-Chinese riots, often led by lamas

The team searching for the reincarnation, or "Soul boy", confirmed the final three candidates in their November 8-11 meeting in Beijing, the Xinhua news agency said. There had been 28 potential reincarnations.

A final choice will emerge in a last test, drawing lots in the form of names hidden in balls of dough from a golden urn, that is expected to take place soon in the Tibetan capital, Lhasa, Xinhua said.

Tibetan Buddhists, believing that the soul of a living Buddha migrates to a boy born shortly after his death, must identify this "soul boy" through ancient and rigorous tests.

However, China insists the boy chosen by lot still needs a final stamp of approval from the officially atheist central government.

Xinhua did not identify the three short-listed boys but said they did not include Gedhun Choekyi Nyima, whom the Dalai Lama recognised in May as recipient of the Panchen Lama's soul.

"The act of the Dalai Lama in choosing a reincarnated child through fraud violated the cardinal principles of Buddhism," it quoted participants as saying. "The so-called reincarnated child therefore fails to meet the conditions for the soul boy".

Beijing regularly accuses the Dalai Lama of trying to split China and of fomenting an independence movement in the region since he fled into exile after an abortive uprising in 1959.

China maintains it has final say over the appointment of senior lamas including the Dalai and Panchen Lamas, under terms of a 1792 Qing dynasty agreement. By tradition, the Dalai Lama must also confirm a reincarnation of the Panchen Lama.

However, supporters of the Dalai Lama said in a report issued in London on Saturday that some lamas at the Beijing meeting urged China to reinstate Gedhun Choekyi Nyima. The call fell on deaf ears.

Li Ruihuan, one of seven members of the Communist Party's omnipotent Politburo Standing Committee, attacked the Dalai Lama and his supporters for delaying the search.

The Dalai Lama fled into exile in 1959. He is still widely revered in Tibet as a god-king.

The rejection of the child recognized by the Dalai Lama sets up a confrontation between the government and the Dalai Lama. The Tibetan government-in-exile condemned "the politicization and abuse of the Tibetan people's religious beliefs" and rejected the outcome of the Beijing meeting.

"To all Tibetans, the boy recognized by the Dalai Lama is the sole legitimate reincarnation, no matter what methods the Chinese authorities may use to put a stamp of legitimacy on their present move," Lodi G. Gyari, an envoy of the Dalai Lama based in Washington, said in a statement.

Chinese authorities in May detained Chadrel Rinpoche, the head of the search committee for the Panchen Lama, and accused him of colluding with the Dalai Lama, the government-in-exile has said.

A Chinese official told reporters in August that the abbot had been hospitalized for months, but refused to give further information about him.

Beijing also removed monks at Tashilumpo monastery in Tibet, the traditional home of the Panchen Lama, who supported the boy recognized by the Dalai Lama, and replaced them with pro-Beijing Tibetans, said the international Campaign for Tibet, a Washington-based advocacy group.

China invaded Tibet in 1950 and claims it has had sovereignty over the region since the 13th century. Many Tibetans say they had de facto independence for much of that time.