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DATE=9/12/1999 TYPE=CORRESPONDENT REPORT TITLE=RUSSIA/CAUCASUS (S&L) NUMBER=2-253764 BYLINE=EVE CONANT DATELINE=MOSCOW CONTENT= VOICED AT: INTRO: Russian military officials say they expect to establish control over two villages, Chabanmakhi and Karamakhi, held by Islamic militants in Dagestan. Moscow correspondent Eve Conant reports a rebel leader says militants have withdrawn from positions in the western Novolakskoye area, but Russia claims fighting still continues in the region. TEXT: Chechen fighter Shamil Basaev, who has led insurgents in Dagestan, told reporters his fighters have completely withdrawn from the Novolakskoye region. He also denied any link between his fighters and two recent explosions in Russia -- one in an apartment block in Dagestan that killed more than 60 people, and another in a Moscow apartment building in which more than 90 died. But the Chechen leader says his forces will continue to fight the Russian army and that his men have simply retreated to previously determined positions. He vowed to continue the fight until, as he put it -- our people are freed from Russian occupation. Russian military officials say despite the rebel leader's statements, heavy fighting continued (Sunday) in the Novolakskoye area. /// OPT REST FOR LONG/// Russian news agencies report the Russian flag has already been raised in the village of Karamakhi and that a clean-up operation to rid the area of insurgents will soon be completed. The insurgents, who crossed into Dagestan from neighboring Chechnya, want to establish an independent Islamic state in Dagestan. The rebels call themselves holy warriors fighting Russian control in the North Caucasus. Rebel leader Shamil Basayev was a prominent field commander during Russia's 1994-1996 civil war with Chechnya that ended in de-facto independence for the breakaway region. (SIGNED) NEB/EC/DW/RAE 12-Sep-1999 10:45 AM LOC (12-Sep-1999 1445 UTC) NNNN Source: Voice of America .

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