Intensive discussions are under way between Nepal's government and Maoist rebels, including behind prison walls, ahead of the imminent start of formal peace talks, key mediators in the process told AFP.

The informal meetings, in which the Maoists are seeking to secure the release from prison of some 3,500 to 4,000 of their cadres, are aimed at smoothing the way for the official talks, they said in an interview late Friday.

Home ministry sources said the releases could begin next week, but that official talks would likely only start later in February.

The two mediators, medical doctor Birendra Jhapali and traditional doctor Dhani Ram Lamichhane, said they had over the last two days accompanied government chief negotiator Narayan Singh Pun to various jails in and around the capital to meet Maoist leaders.

"Both sides agreed they had to

forget their differences and work together to take a new direction ... and create a new and beautiful and developed Nepal," said Lamichhane.

Aside from a rebel demand for freeing Maoists detained under the Terrorist and Disruptive Activities Act, he said, talks had also broached an all-party round-table conference the government has agreed to call to map out the political future of the Himalayan kingdom.

Among prisoners met by Pun, who is public works and transport minister, were two central committee members of the Nepal Communist Party (Maoist), Ram Karki, alias Partha Chhetri, and Bam Dev Chhetri.

Jhapali said informal talks had begun between the government and Maoists in October, soon after King Gyanendra dismissed elected premier Sher Bahadur Deuba as "incompetent" in dealing with the seven-year insurgency.

Frequent discussions had in the past few months taken place in

Kathmandu between Pun and a representative of the Maoists' politburo who goes under the pseudonym Sagar Chhetri.

The mediators, who describe themselves as "leftists but not Maoists", declined to identify the Maoist leader at the forefront of the negotiations.

Maoist sources, meanwhile, said senior rebel leaders, including a number of central committee members, had begun meeting Friday at Panga, on the outskirts of Kathmandu, to discuss strategies for the upcoming peace talks. The meeting was expected to last through the weekend.

Lamichhane scoffed at press reports which had claimed the king himself had met Maoist leaders in his palace on Monday, two days before the government and rebels announced a mutual ceasefire.

While the king had given his nod and perhaps even initiated the peace process, he had not intervened directly, Lamichhane said.