Sunday's meeting between Prachanda and Prime Minister Girija Prasad Koirala is a positive sign but it would be "exaggerating" to call it a breakthrough, said the UN's top official in Nepal today.

"Even before yesterday there were informal contacts between the two parties, preparatory work going on towards a summit. the significance of yesterday's meeting (is that) it's been described as a confidence-building meeting," said Ian Martin, who arrived here a month ago after being named the personal representative of UN Secretary-General Kofi Annan. Martin formerly headed the UN's human rights office here.

Since he took over his new position he has held talks with both Koirala and Maoist leader Prachanda, who "does continue to envisage the UN playing the role set out in the letters", Martin told journalists at UN House. There is a lot to be done, going by last week's unrest after the army started moving vehicles that the Maoists alleged were imported from India, said Martin.

"The major lesson from that is there does need to be a full ceasefire agreement in place.the code of conduct is the only agreement between the two parties and there are a lot of issues it doesn't address. It doesn't say anything about additional weapons, movement of vehicles."

Martin refused to speculate on issues such as how much time remains to cut a deal before frustration spills over onto the streets and when the rest of his team-including military, political, ceasefire and electoral advisers-will arrive, blaming their tardiness on a mix of UN red-tape and slow progress at the peace table.

Asked how likely it was that constituent assembly elections could be held in this Nepali year, as suggested by Koirala, Martin answered: "Things are going to have to move pretty fast if a date as early as that is going to be even technically feasible. The political decisions would have to be made fairly rapidly."

Marty Logan