The Nepalese government has agreed to partially withdraw its army and release three jailed rebel leaders, following a second round of peace talks with Maoist insurgents.
Government negotiator Narayan Singh Pun says soldiers will remain within five kilometers of their barracks, meeting a long-standing rebel demand that the army should be pulled back. The announcement came following a second round of peace talks between the two sides in the Nepalese capital, Kathmandu.
The army was deployed across Nepal to crush the rebellion 1.5 years ago, after the collapse of an earlier peace initiative led to a sharp increase in violence.
There has been no fighting in the mountain kingdom since the government and the rebels signed a truce in January. The rebels began their violent struggle to replace the country's constitutional monarchy with a communist republic in 1996.
The government has also agreed to set free three top rebel leaders now in detention, and investigate the alleged disappearance of more than 300 Maoist supporters.
The chief rebel negotiator, Krishna Bahadur Mahara, says the government's decision to agree to two key rebel demands will "create an atmosphere of confidence" for the peace process.
The next round of peace talks is expected to focus on the more difficult political demands raised by the Maoists. The rebels are asking for the establishment of a constituent assembly to draft a new constitution for the country. They say the present constitution is too rigid and fails to address the needs of the people.
The government has said it needs more time to consider these issues.
Previous peace talks broke down in November 2001, after the government refused to abolish the monarchy. The rebels have said they are prepared to be flexible on this issue, and would respect the will of the people, if they want to maintain the institution.
More than 7,600 people have been killed in the Maoist insurgency. The rebellion has also wrecked infrastructure, frightened away tourists and devastated the economy of the mountain kingdom, which is one of the world's poorest countries.