AS NATO promised to increase its air bombardment of Serb forces in Kosovo, alliance leaders rejected a ceasefire offer from the Yugoslavian President, Slobodan Milosevic, in return for an immediate halt in hostilities.
After six hours of talks with the Russian Prime Minister, Yevgeny Primakov, in Belgrade, the Serb leader promised that he would reduce his forces in Kosovo and allow "all peaceful refugees" to return to the province "if they are Yugoslav citizens", provided the Nato bombardment ends.
Serb television quoted Mr Milosevic as saying that "Nato aggression should stop" because it is a threat to "international security". There was also speculation that the Serbs would be prepared to accept a peace- keeping observer force in Kosovo made up of neutral nations and perhaps also Russia. But last October's peace agreement in Kosovo itself provided for a reduction in Serb forces and for international observers - an accord that disintegrated when the Serbs refused to accept the military implementation of the autonomy plans accepted by the Kosovo Albanians in Paris this month.
Furthermore Nato, according to Mr Primakov, would also have to end its support for the Kosovo Liberation Army - an unlikely step since KLA representatives signed the Paris autonomy agreement. And tens of thousands of Kosovo Albanians do not hold Yugoslav passports; very few acknowledge Yugoslav sovereignty. So how could they "return" to Kosovo? Mr Primakov arrived in Bonn from Belgrade last night to say that Mr Milosevic's offer was "a positive beginning and if the other party [Nato] is willing, a dialogue can start". Mr Milosevic was ready to be "constructive" if Nato showed positive signs of accepting the idea.
But after speaking to Mr Primakov, the German Chancellor, Gerhard Schroder, speaking for the EU, said: "This is no basis for a political solution."
In London, the Foreign Secretary, Robin Cook, said he welcomed Mr Primakov's efforts but that Mr Milosevic's proposals "falls far short of what is required." On the other side of the Atlantic, the US State Department spokesman James Rubin described the Milosevic proposals as "woefully inadequate".
And in the first hint that the United States could support independence for Kosovo once the violence is over, President Bill Clinton warned that if the Serb assault continued, "international support for Serbia's claim to Kosovo will be increasingly jeopardised".
A State Department spokesman later said that the US position on Kosovo independence had not changed.
Mr Milosevic - well aware that Nato fatally miscalculated Serb resistance - may simply be trying to gain the moral high ground, aware that his forces could pursue their ferocious campaign in Kosovo the moment Nato rejected his offer. Yet faced with its unwillingness to send ground troops into battle and the humanitarian catastrophe its bombardment provoked - and which Serb forces brought about - there will be Nato nations all too ready to accept any chance of a ceasefire in what now looks like an unwinnable war.
Nato's bombardment of Yugoslavia had continued even as Mr Primakov arrived in Belgrade. The handshakes and arm-clasps were fraternal, the smiles broad as he stepped from his Tupolev jet at the glass-shattered airport in Belgrade. Mr Primakov said that he was trying to move the crisis into political territory or - as he put it in colloquial Russian - "into the political tub".
Mr Milosevic received Mr Primakov in the Beli Dvor - the ornate "White Palace" that was home to the Yugoslav monarchy and later to Tito - in the Belgrade suburb of Topsider, scarcely three miles from the military base at Rakovica that has already been bombed four times by Nato aircraft. Mr Primakov had brought with him his Defence Minister, Igor Sergeyev, Foreign Minister, Igor Ivanov, and senior Russian intelligence officers.
Shortly after he sat down with Mr Milosevic, Mr Primakov raised both his arms as if imitating the flight of an aircraft - and it is certain that the Russians expressed interest in examining the wreckage of the American F-117A "Stealth" fighter that crashed 25 miles from Belgrade on Saturday.
But even as Mr Milosevic spoke to his guests, new facts were being created on the ground in Kosovo. With more than 25 per cent of the Kosovo Albanians displaced and legions of refugees still pouring into Macedonia, Albania and Montenegro, the Serbs may soon be in a position to claim that northern Kosovo has been abandoned by its ethnic Albanian population. There are growing suspicions in Belgrade that once this has been accomplished, Nato may tacitly accept a division of the province with the capital, Pristina, the Drenica region and the Trepca lead, zinc and gold mines - the most valuable piece of real estate in the Balkans - remaining in Serb hands.
The Serbs remain convinced that Nato has turned into a tool of the KLA. However fanciful the notion, it has been fuelled by Serb claims that Nato raids on Serb security forces in Kosovo have been followed by KLA attacks on the newly bombed facilities. Serbia's conviction that it is the victim of a Nato-KLA plot will have been only reinforced yesterday when the Secretary of State for Defence, George Robertson, said: "If these people [the Kosovo Albanians] say Nato is right to act, who has got the right to say they are wrong?"
Hence Mr Milosevic's insistence that any ceasefire must be accompanied by an end to Nato's support for the KLA.
Figures suggest that up to 36,000 Yugoslav forces - 20,000 soldiers and 16,000 special police - are now in Kosovo, clear proof that air strikes have totally failed to dissuade the Serbs from their offensive. Any hope that Mr Milosevic would accede to American and European plans for an international peace-keeping force in Kosovo after two or three days of bombing have been abandoned.
Among those most critical of Nato's miscalculations is Carl Bildt, the highly respected former European envoy to Bosnia who has condemned Nato for bombing without the motivation and will to commit ground troops to the battle for Kosovo.
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