It is unclear how long the proclaimed ceasefire will last, but the agreement is a political coup for the Russian President. Russia has been mired in the conflict in Chechnya for 17 months and the war has been a political millstone around Mr Yeltsin's neck. The deal comes just ahead of presidential elections on 16 June.
"This is a historic day, a historic moment," Mr Yeltsin said last night, after signing the deal with Zelimkhan Yandarbiyev, successor to Dzhokhar Dudayev, who led Chechnya's bid for independence and was killed in a Russian rocket attack last month.
Both sides avoided the most difficult issue - Chechnya's demands for independence, which remain on the table. Chechen leaders continue to talk of secession. Moscow, on the other hand, treats Chechnya as part of the Russian federation.
The deal provides for a halt to military activity, an exchange of all prisoners within two weeks, and further negotiations to end the conflict. Previous deals on the exchange of prisoners have foundered amidst much recrimination. Both sides have regularly reneged on agreements. Last summer, a plan to disarm the Chechens as Russian troops withdrew, was quickly forgotten.
Both sides seemed tense during yesterday's signing of the ceasefire document, whose exact contents were not revealed. Viktor Chernomyrdin, the Russian Prime Minister, could be heard to say: "Just sign it, what's the difference?" in reply to a remark from the Chechen side of the table.
Mr Yeltsin said he would give the order for an end to military activities to the Interior Minister, Anatoly Kulikov, and the Defence Minister, Pavel Grachev. Mr Grachev, who was not at the signing, last week seemed furious that the war was being wound down before the final defeat of the Chechens.
Mr Yeltsin said that the problem of peace had now been "resolved". Asked about whether the deal would stick, he insisted that "we are unanimous".
Once a new Russian president is elected, he would, however, be less susceptible to public opinion and could decide to wage an indefinite war.
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