By Steve Scherer and Rod Nickel

OTTAWA/EDMONTON, Alberta (Reuters) - The Canadian government, under pressure at home to be tougher on Iran over intelligence reports it shot down a passenger jet, on Friday reiterated calls for a full probe into the disaster and warned Tehran that "the world is watching".

Friends and families of some of the Canadians killed when a Ukrainian airliner crashed outside Tehran are demanding Prime Minister Justin Trudeau take a harder stance after accusing Iran of downing the plane, albeit probably by mistake. Iran denies the charge.

"Time will tell and the world is watching," said Foreign Minister Francois-Philippe Champagne when asked whether Iran was conducting its probe into what happened in good faith.

"I think transparency is what the international community is looking for now," he told a news conference.

Champagne said Ottawa now thought 57 Canadians died in the crash, down from an initial 63, and said an emergency task force was being created to help the families of the victims.

While Trudeau faces pressure at home to respond strongly, he has few options, especially after Canada broke off diplomatic relations with Tehran in 2012. Iran has said it will allow Canadian, U.S. and other international officials to participate in the investigation into Wednesday's crash.

The prime minister "completely misses the point" when he does not condemn the Iranian government, said Ali Ashtari, 39, a data scientist from Toronto who lost a friend in the crash.

Ashtari said Canada should designate Iran's Islamic Revolutionary Guard Corps (IRGC) as a terrorist organization and impose sanctions on them. The government already lists the IRGC's overseas arm, the Quds Force, as a terrorist group.

"This is the minimum that we want from the government," Ashtari said at a vigil in Toronto. "Otherwise it's just giving speech with teary eyes, it gives nothing."

Trudeau said Ottawa had demanded Canadian access to Iran to provide consular services, identify victims and participate in the crash investigation.

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Champagne said Iran had granted two visas so far to Canadian officials.

The crash on Wednesday, which killed all 176 people on board, occurred as Iran was on alert for possible reprisals after it launched missiles on bases housing U.S. troops in Iraq.

"We would just urge him (Trudeau) to use all his power to find out what really happened and hold the responsible accountable," Amir Arsalani, who lost his sister, her husband and their one-year-old daughter, told Reuters.

Trudeau sidestepped questions on Thursday as to whether the United States should be held at least partially responsible given that Iran's attack on U.S. forces was in retaliation for a U.S. drone strike that killed Qassem Soleimani, former Quds Force leader.

The Canadian Broadcasting Corp. cited two government sources as saying Washington should have warned Canada in advance about the drone strike. Ottawa also wants a more thorough explanation of the thinking behind the attack, they added.

Champagne did not answer questions about whether Canada should have been warned.

Ottawa is focusing in talks with allies on how it can play as large a role as possible in the probe rather than expressing anger against either Iran or the United States, according to three sources familiar with the private conversations.

"There has been no fingerpointing or blame at this stage," said one of the sources, who requested anonymity given the sensitivity of the situation.

Relations between Trudeau and U.S. President Donald Trump are formal at best, with Trudeau last month caught on camera joking about Trump, and the president calling him "two-faced".

There was no benefit to the government to further sour relations by making "a big public statement" about the United States, said Stephanie Carvin, a former national security analyst and international relations professor at Carleton University in Ottawa.

Ottawa's best option for now was to persuade like-minded nations to put pressure on Iran, she added.

Champagne said Canada had formed a coordinating group with Britain, Ukraine, Sweden and Afghanistan to help the families of the victims and pressure Iran for a full probe.

Trudeau has few ways to punish Iran in the short term. Bilateral trade - already limited by sanctions related to Iran's nuclear program - totaled just over C$200 million in 2018.

Trudeau was due to meet privately with family members of the victims in Toronto on Friday.





(Additional reporting by Moira Warburton and Allison Martell in Toronto, Steve Scherer, David Ljunggren and Kelsey Johnson in Ottawa; Editing by Frances Kerry and Sonya Hepinstall)