Evelyn Leopold, United Nations – Indonesia apparently has agreed for the first time to a UN ballot in troubled East Timor as its foreign minister and his Portuguese counterpart mapped out steps that could lead to Jakarta's withdrawal from the territory by the end of the year, diplomats said.

Both Ali Alatas of Indonesia and Jaime Gama of Portugal expressed optimism on Sunday after the first of two days of UN-brokered talks. Alatas said he "agreed in principle" on consultations with the Timorese that could include some type of vote, an idea previously rejected by Jakarta.

According to officials in the talks on the future of the former Portuguese colony that Indonesia controls, the ministers reached an informal understanding on the following steps:

• the talks would end with a new plan by April after which the United Nations would organise a vote in East Timor. This would allow residents to accept or reject a wide-ranging autonomy package that would leave Timor as part of Indonesia.

The ballot would have to be arranged before Jakarta's newly-elected legislature takes its seat in August.

• If the Timorese reject the option, Indonesia would ask the legislature to rescind its incorporation of the territory it invaded in 1975 and annexed a year later. The annexation has never been recognised by the United Nations, which considers Portugal the administrator.
• Indonesian authorities would then begin pulling out of East Timor over several months as Portugal resumed authority, along with a UN mission and police force. Timorese could then vote on their future status, elect a constituent assembly and map out a constitution if they chose independence.

"We hope that by April, at the latest, we can have a model that we can show to the Indonesian people and of course to the East Timorese," Alatas said.

He said that if the autonomy plan was rejected East Timor would revert to its pre-1976 status as "a non-self-governing territory with Portugal as its (administrator) and still within the fold of the United Nations."

He refused to call the election a referendum, something Indonesia has objected to in the past, apparently fearing other regions in the archipelago would demand the same. He said the type of consultations, which could be a ballot, would be discussed in the future.

Gama said there was broad agreement on a "vote organised by the United Nations in the territory." He said he had asked Secretary-General Kofi Annan for a UN mission in Timor as soon as possible but this question had not yet been decided.

Indonesia suggested independence as a "second option" on Jan. 27. The offer came some eight months after Jakarta was plunged into economic and political turmoil last May when President Suharto was replaced by President B.J. Habibie after three decades of rule.

Senior officials from Indonesia and Portugal have been negotiating an autonomy package for months at the United Nations under the mediation of Jamsheed Marker. The talks gained momentum after the Habibie government took office after years of stalemated negotiations.

The two ministers saw Annan earlier on Sunday before he flew to Jordan for King Hussein's funeral. Annan made it clear that "whatever we do, the East Timorese will be very much part of it and nothing will be done without their participation."

Tension and fighting in the territory of 800,000 people heightened after Indonesia announced it might let East Timor go – abruptly reversing years of staunch opposition to any suggestion of independence.

The Indonesian army has been reported to be handing out weapons to civilian recruits in East Timor, which it denies. "If they supply the arms they have to control them," Gama said. "We hope that they fully control them to disarm."

Asked what major difference remain, Gama told a group of reporters "there is the negative temptation to have an unsuccessful transition to independence – a worst case scenario for moving to independence."