TORONTO, SEPT. 6 -- Montreal's vital Mercier Bridge was reopened to commuter traffic today for the first time in eight weeks, but a lingering standoff between army troops and a small holdout group of heavily armed Mohawk Indians in a suburb west of the city demonstrated that the conflict between Canada and its Indians is far from over.

Beyond the still potentially explosive face-off between soldiers and Mohawks across coils of razor wire surrounding a former alcohol treatment center at Oka, Quebec, is a complex and seemingly intractable issue of Indian sovereignty and the future political relationship between the federal government and the country's 600,000 Indians.

Commuters blared their horns in celebration early this morning as nearly 70,000 cars poured across Mercier Bridge, the principal artery to Montreal Island from communities on the south bank of the St. Lawrence River. Since July 11, the commuters have had to make detours that added up to three hours to their trips to and from the city.

But as normalcy -- and traffic -- returned to the bridge, Indians in Ontario and New Brunswick provinces, and elsewhere in Canada, provoked new confrontations with authorities. Many manned road and rail blockades to press their demand for a withdrawal of about 400 army troops from the Kahnesatake Mohawk settlement near Oka, where about 20 radical members of the paramilitary Mohawk Warrior Society -- wearing face masks and camouflage fatigues -- and an equal number of women and children are holed up in the old alcohol treatment center.

All the protest demonstrations today were conducted peacefully, and authorities made no attempt to dismantle any barricades.

The Indians at Oka, some armed with AK-47 and M-16 assault rifles, are the holdouts of a group of several hundred Mohawks who fought a gun battle with Quebec provincial police July 11 at barricades near a disputed tract of land. A police officer was shot and killed in the confrontation.

In solidarity with the Oka Mohawks, who were protesting a decision by Oka's city council to expand a nine-hole golf course onto land the Indians claimed was theirs, Mohawks of the nearby Kahnawake Reservation sealed off access roads leading to Mercier Bridge, prompting sporadic rioting by non-Indian residents of South Shore communities until the Mohawk barricades were removed last week.

The immediate issue in the lingering Oka standoff is how authorities will pursue their investigation into the death of Police Cpl. Marcel Lemay in the July shootout, and into other crimes allegedly committed during the siege at Oka.

Among weapons seized by police this week were a .50-caliber machine gun with armor-piercing shells, Israeli-made Uzi submachine guns, AK-47s and M-16s and other weapons proscribed by Canadian law. Police also are pursuing criminal cases involving alleged widespread property destruction by the Indians, assaults, trespassing and other offenses.

While Quebec's justice minister, Gil Remilliard, has proposed creating a special "human-rights tribunal" to ensure that Mohawk offenders are treated fairly, he and other provincial authorities have rejected Indian demands for immunity from prosecution.

"If we are going to have a democracy and live in a civilized society, the rule of law must be upheld," Remilliard said.

The Mohawks, however, maintain that the Quebec provincial police are bent on reprisals to avenge Lemay's death. They have demanded that the holdout Warriors and their supporters be allowed to leave the alcohol treatment center with their weapons without being arrested or harassed by police.

Quebec police officials have denied they are seeking revenge and have accused the Mohawks of trying to cover up a number of illegal activities they say are taking place on the reservations, including gun-running, the sale of tax-free cigarettes and the operation of gambling casinos.

As part of a compromise package presented Wednesday and today to Canadian officials in Ottawa, Indian negotiators, including George Erasmus, chief of the Ottawa-based Indian-rights umbrella group Assembly of First Nations, have proposed that permanent and effective Indian police forces be established to address the Indians' deep-seated distrust of government law enforcement agencies.

A number of Indian reservations in Canada already have quasi-official Indian police forces, such as the Mohawk Peacekeepers on the Kahnawake Reservation adjacent to Mercier Bridge. But their autonomy and policing powers are limited, and in the face of serious crimes or conflict they often are shunted aside by provincial police or other law enforcement agencies.

Quebec's minister for public security, Sam Elkas, said that once the Oka crisis is over, the Mohawks of Kahnesatake and Kahnawake, under the supervision of provincial authorities, will be allowed to set up their own police departments. But, he stressed, they will have to "enforce Quebec laws and the Canadian criminal code . . . and obey our orders."

The police question goes to the core of the broader and more complex issue of what the Mohawks view as a need to redefine the political relationship between the Canadian government and the country's approximately 600,000 "status" Indians, or persons legally defined as aboriginals recognized and protected by laws and treaties.

Quebec is the only province in Canada that has formally recognized Indians as members of "nations" within the Canadian confederation, a largely symbolic distinction that was made in 1983 by the then-ruling Parti Quebecois, which itself was seeking sovereignty from English Canada. Ironically, the Mohawks' demands are similar to those of the French-speaking separatists -- increased control over their society, justice system and education and freedom to pursue independent economic development.

In a background paper submitted during on-and-off negotiations to end the Oka confrontation, the Mohawks said they were seeking to create "Kahnienkahaka," a unified Mohawk nation that would straddle the Canada-U.S. frontier, stretching eastward from Brantford, Ontario, to Oka, Quebec, and southward to Plattsburg, N.Y.

They also demanded complete sovereignty over that territory, including the right to make and enforce laws, establish their own armed forces and sign international agreements.

The demands prompted Bernard Roy, a government negotiator, to remark: "They demanded what no responsible government could ever concede -- that Canadian law no longer applies to them and that the Mohawk community be recognized as a separate nation-state."

In recent days, the Indians have modified their demands somewhat, apparently in response to Prime Minister Brian Mulroney's insistence that federal officials will not negotiate on such broad issues as self-governance "under the barrel of a gun."

Erasmus, stressing the need to defuse the crisis at Oka to create a climate for negotiations, said the Indians were now interested in talking about sovereignty "in terms of degrees" instead of absolutes. But he said that even that level of talks was not possible until the soldiers at Oka are withdrawn at least a few hundred yards to give the holdout Warriors "some space."