ISTANBUL (Reuters/AFP) - Rebel leaders won recognition as the legitimate government of Libya from the United States and other world powers on Friday in a major boost to the rebels' faltering campaign to oust Muammar Gaddafi. Western nations said they also planned to increase the military pressure on Gaddafi's forces to press him to give up power after 41 years at the head of the North African state. Recognition of the rebels, announced by Secretary of State Hillary Clinton at a meeting in Turkey of the international contact group on Libya, is an important diplomatic step that could unlock billions of dollars in frozen Libyan funds. The decision comes as reports are circulating that Gaddafi has sent out emissaries seeking a negotiated end to the conflict, although he remains defiant in his public utterances. In a speech broadcast as thousands of loyalists rallied in a street demonstration, Gaddafi rejected international recognition of the rebels. "Trample on those recognitions, trample on them under your feet," he told his supporters. "They are worthless." He said he enjoyed the support of millions of Libyans who yearned for death, martyrdom and suicide. The Istanbul conference attended by more than 30 countries and international bodies also agreed a road map whereby Gaddafi should relinquish power and plans for Libya's transition to democracy under the rebel National Transitional Council (TNC). "Until an interim authority is in place, the United States will recognise the TNC as the legitimate governing authority for Libya, and we will deal with it on that basis," Clinton said. The decision to recognise the rebels, who have been waging a five-month military campaign against Gaddafi, meant the Libyan leader had no option but to stand down, Italian Foreign Minister Franco Frattini said. The UN secretary-general's special envoy to Libya, Abdul Elah al-Khatib, will be authorized to present terms for Gaddafi to leave power, but the British foreign minister said military action against Gaddafi would be stepped up at the same time. The political package to be offered Gaddafi will include a ceasefire to halt fighting in the five-month-old war. A rebel spokesman said he did not expect a ceasefire until Gaddafi had been defeated and rejected suggestions of a pause in the fighting during the holy month of Ramazan, which begins at the start of August. British Foreign Secretary William Hague told Reuters that at the same time as al-Khatib pursues a political settlement, "the military pressure on the regime will continue to intensify." Meanwhile, Venezuelan President Hugo Chavez on Thursday sent a message of support to embattled Libyan leader Moamer Gaddafi, urging him to resist and calling on European nations to worry about their own domestic issues. "There is Gaddafi resisting. Until when will this outrage last?" Chavez said at a meeting of his ministers. Part of the event was broadcast on the state television network VTV.