Armenia has said it could recognize the breakaway Nagorno-Karabakh region as an independent state if Azerbaijan carries out its threat of military action to take back the mountain territory, raising tensions in the long-drawn-out conflict following the latest round of talks between leaders of the two countries.


"It should be noted that Armenia so far has not recognized the independence of Nagorno-Karabakh for one reason -- so that it would not become an obstacle to peaceful negotiations,” Armenian President Serzh Sarksyan's spokesman Samvel Farmanyan said in a statement on Monday. "If peaceful negotiations break down and military action begins, then nothing stands in the way of Armenia recognizing the independence of Nagorno-Karabakh."

Sarksyan and Azerbaijani President Ilham Aliyev had talks on Sunday in Munich on the Nagorno-Karabakh conflict, followed by statements from mediators that the two leaders achieved progress. “Some important progress has been reached,” French mediator Bernard Fassier told reporters after the talks. “At the same time we have identified some difficulties.”

There was speculation in the Turkish media that there was a breakthrough during Sunday’s talks, with Armenia agreeing to withdraw from regions adjacent to Nagorno-Karabakh. But Farmanyan dismissed the reports on Monday, saying, “Such a question is not being discussed.”

Fassier said he and his co-mediators from the United States and Russia would start preparing the next meeting without specifying when it might take place. “We hope for additional progress in the following weeks and beginning of next year.”

Tensions over the Armenian-populated region, which broke away from Azerbaijan with Armenian backing in the early 1990s, are rising as Armenia pursues a historic thaw with Azerbaijan’s ally Turkey to the anger of oil-producing Azerbaijan. In comments broadcast on Saturday, Aliyev warned that Azeri patience was running thin and that without a breakthrough soon, Azeri troops were ready to take back the territory by force.

Fighting in Nagorno-Karabakh erupted as the Soviet Union headed towards its 1991collapse. Some 30,000 people died and more than 1 million were displaced before a ceasefire in 1994.  Ethnic Armenian forces took control of the territory of 100,000 people and seven surrounding Azeri districts, including a land corridor to Armenia.

With no peace deal, soldiers on the frontline continue to be picked off by landmines and snipers. No state has recognized Nagorno-Karabakh as independent.

Turkey signed two protocols in October to normalize its ties with Armenia, severed in 1993 due to the Nagorno-Karabakh conflict, but wants progress in the Nagorno-Karabakh conflict before taking any further steps to restore relations with Armenia.

In Russia, President Dmitry Medvedev was expected on Tuesday to urge Aliyev for a peaceful resolution of the Nagorno-Karabakh dispute. Aliyev was in Ulyanovsk, Russia, on Tuesday to attend a ceremony for naming the city square after former Azerbaijani President Haydar Aliyev and meet Medvedev for talks on energy cooperation and regional issues.  Russia backs the Nagorno-Karabakh solution efforts and the Turkish-Armenian rapprochement.