the burning of the Qur'an by American soldiers and the massacre of 16 civilians by a US gunman.

Hopes of a decisive military victory over the insurgency had long been abandoned, and the Taliban announcement last year that they would open a political office in Qatar had appeared to offer a real prospect of serious negotiations after years of false starts and dead ends.

But the Taliban suspended talks on Thursday, because the group faced "unacceptable demands". The news came in a statement that did not detail the problems but described Washington as "shaky, erratic and vague" and rejected any discussion with Karzai's government as pointless.

The sticking point in talks between the Taliban, Karzai's government and the US is the terms of a prisoner exchange involving five Taliban leaders heldat Guantánamo and a westerner held by the Taliban.

Karzai's office said that his statement summarised comments made in a meeting with the visiting US defence secretary, Leon Panetta.

Karzai said he wanted a nationwide handover of security from western to Afghan forces completed by the end of 2013, a year ahead of the current schedule. He also wants foreign soldiers to return to their bases immediately, leaving Afghan villages and ending patrols that have been a key component of the war.

"Afghan security forces have the ability to keep the security in rural areas and in villages on their own," the statement said.

If this demand is met, it would spell the end for the current coalition military approach, which aims to push out insurgents and win over the civilian population