Speaking on the second day of direct talks with a government delegation from South Korea, the Taliban negotiators said a settlement could be near.

The rebels are demanding the release of comrades held by the Afghan government.

The South Korean Christian Aid workers were seized last month. Two have already been killed by the rebels.

The second day of talks, which were held in the central city of Ghazni, ended with no resolution.

The Afghan government, stung by criticism over a previous prisoner exchange, has ruled out a swap to secure the release of the Koreans.

It promised safe passage to two Taliban leaders so they could attend the talks.

One of them, Mullah Qari Bashir, told reporters yesterday: "We are optimistic about the result of our talks."

He reiterated that his group wanted some of its imprisoned members freed and said that if this happened, the hostages would be released.

Mullah Bashir said the Taliban felt the same way about its jailed men as South Korea did about its captive citizens.