updated 11/2/2008 2:25:10 PM ET 2008-11-02T19:25:10

By Denis Dyomkin

The presidents of Armenia and Azerbaijan agreed on Sunday to intensify efforts to resolve their dispute over Nagorno-Karabakh.

Armenian President Serzh Sarksyan and his Azeri counterpart, Ilham Aliyev also agreed after talks outside Moscow with Russian President Dmitry Medvedev to develop confidence building measures as they search for a way to resolve the conflict.

Nagorno-Karabakh's mostly ethnic Armenian population broke away from Azerbaijan in a war in the early 1990s as the Soviet Union collapsed. It now runs its own affairs, with support from Armenia.

"The presidents of Azerbaijan and Armenia agreed to continue work, including during further contacts on a high level, on agreeing a political resolution of the conflict in Nagorno-Karabakh," according to a copy of the declaration they signed, which was read out by Medvedev.

Both presidents "ordered their foreign ministers to intensify further steps in the negotiating process in coordination with the Minsk group" of international mediators.

Sarksyan and Aliyev, who hastily shook hands before the talks at the Meiendorf Castle official residence outside Moscow, signed the document along with Medvedev, who is seeking to underline Russia's clout in the Caucasus region.

The war between Russia and Georgia in August appears to have lent new impetus to diplomatic efforts to resolve the Nagorno-Karabakh conflict, with Russia trying to show it can act as a broker for "frozen conflicts" in the former Soviet Union.

STICKING POINT

But the 200-word declaration avoided the main sticking point -- the status of Nagorno-Karabakh itself -- and did not go into detail about ways to resolve the conflict.

The search for peace in the territory has long been scuppered by thorny issues such as the issue of the districts outside Nagorno-Karabakh that Armenian forces control. These areas were not mentioned in the declaration.

Nagorno-Karabakh is internationally recognized as within Azerbaijan's borders.

Armenia supports Nagorno-Karabakh's split from Azerbaijan and provides assistance though no state -- including Armenia -- has recognized it as an independent state.

Fighting between Azerbaijan and Armenia over the area ended in 1994 when a ceasefire was signed. The two sides are still technically at war because no peace treaty has been signed.

About 35,000 people on both sides were killed in the fighting. More than a million people were forced to flee their homes and almost all are still unable to return.

Along with France and the United States, Russia is one of the co-chairs of the Minsk Group, which is mandated to act as an intermediary in the Nagorno-Karabakh conflict. But it is unusual for a head of state to act directly as mediator.

The presidents "announce that they will promote a recovery of the situation in the South Caucasus and promote the establishment of stability and security in the region through a political resolution of the Nagorno-Karabakh conflict on the basis principles and norms of international law."

Armenia is considered Russia's strongest ally in the Caucasus, but is also being courted by the United States and European Union in a struggle with Moscow for influence over a transit route for oil and gas from the Caspian.

Copyright 2012 Thomson Reuters. Click for restrictions.

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