Russia completed a security zone along its border with Chechnya yesterday and the Prime Minister, Mr Vladimir Putin, gave a fresh signal that Moscow planned to cut the rebel territory in two.
Mr Putin said President Boris Yeltsin had approved the formation of a state commission to resettle tens of thousands of refugees from Chechnya in those parts of the rebel region under the control of Russian federal forces.
His statement followed days of speculation in the Russian media that federal troops would not only guard the borders with Chechnya but move to occupy the low-lying northern districts as far as the Terek river just north of the capital Grozny.
The Russian air campaign has triggered a huge refugee crisis, with Ingush President Ruslan Aushev saying 110,000 Chechens had fled west into his tiny republic since the start of the emergency. However, Mr Putin cast doubt on the figure yesterday, saying: "We think that the figure for the refugees that is being mentioned is too high."
Meanwhile, Chechnya said yesterday Russian tanks and soldiers pushed to within 20 km of Grozny for the first time since the brutal 1994-96 Chechen war, but Moscow sharply denied the claim. The federal forces battled rebels for control of Chervlennaya village on the north bank of the Terek river, according to the prefect of the neighbouring Naurskaya region.
Casualty reports could not be independently confirmed. Officials in Grozny said some 100 federal forces have been killed since Russia invaded the republic last Friday. However, Russian authorities said only two of their soldiers had been killed.
Mr Putin denied that there was any heavy fighting near Chervlennaya. "This information does not correspond with reality," he said.
Russian forces have moved in to Chechnya in an attempt to wipe out suspected terrorist bases in the breakaway republic. Grozny denies that it harbours any terrorists and has vowed to fight off the Russian offensive.
The offensive is in response to two summer incursions into Dagestan by Islamic guerrillas accused by Moscow of masterminding a wave of bomb attacks on apartment blocks across Russia which have killed 292 people since September 4th.
Russian air force strikes in Chechnya since September 5th have killed more than 600 civilians, according to Chechen figures.
Itar-Tass news agency quoted Lieut-Gen Gennady Troshev as saying federal forces had completed the security zone adjoining Chechnya, as ordered by Mr Putin. He was also reported as saying that in some areas the troops had advanced on to Chechen territory.