Armenian offensive dashes Azeri peace hopes: Hundreds of children drown while fleeing latest attacks

IF AZERBAIJAN'S new government believed that making up with Moscow would end its nightmarish string of defeats by the Armenians of Nagorny Karabakh, its hopes have been horribly dashed.

By the time a one-week Armenian offensive died down over the weekend, diplomats said the attacking forces had captured virtually all of south-western Azerbaijan, joining the southern edge of Nagorny Karabakh with Armenia proper and 60 miles of the Azeri border with Iran.

Many children were drowned while trying to swim to safety across the Araxes river to join at least 16,000 Azeris forced out of their homes. The eventual number of new displaced may reach 60,000, said the Baku representative of United Nations, Mahmoud el-Said.

'We have reports of several hundred people drowning while trying to cross, mostly children. The whole horrific aspect of this is the human suffering,' he said by telephone from Baku. Mr el-Said described driving along the Iranian side of the Araxes river border on Friday. In Azeri towns and villages, he said, 'everything was on fire . . . on the Iranian side of the border I saw thousands of refugees, desperate, with nothing.'

At least one in 10 of Azerbaijan's seven million people have been displaced in five years of conflict with Armenia, and at least a fifth of its territory has now been occupied by Armenian forces, including Nagorny Karabakh, the original bone of contention.

Diplomats said that the Armenian action may have been triggered by a small attack from the Azeri side, probably by a contingent of Afghan mujahedin mercenaries hired months ago. But the massive Armenian response and Russia's official indifference has stunned President Geidar Aliyev's government and means that progress is unlikely in the main forum for peace negotiations, the nine-nation Minsk Group of the CSCE that started meeting in Vienna yesterday.

Mr Aliyev had hoped the conflict with Armenia could be solved by mending fences with Russia, Armenia's principal ally, and reversing the pro-Western, pro-Turkish trend of the previous Azeri government ousted in June. But Moscow was either unable or unwilling to help, given the controversy over its commitments in Georgia, Tajikistan and elsewhere.

Some diplomats believed that hardliners in Russia had flashed a green light for the attack. The idea would be to force the new government of President Aliyev to agree to humiliating peace terms and a Russian 'interposing force' paid for by the CSCE. The aim might also have been to humble Mr Aliyev himself.

'The Russians were angry that Aliyev did not agree immediately to their proposals for the Caucasus at the Moscow summit a month ago,' said one diplomat. 'They have used Aliyev to smash the nationalist government in Azerbaijan. Now they may want to crush the last vestiges of Western influence.'

The 70-year-old former KGB General and member of the Soviet Politburo has vowed to keep Azerbaijan's door open to the West and has promised that a Western consortium headed by British Petroleum will take the lion's share of developing Azerbaijan's oil riches in the Caspian Sea.

But it is unclear how the oil can be exported without Russian goodwill and with Azerbaijan still in disarray. Mr Aliyev's policy remains that set out in his inauguration speech last month: to create a proper army and recapture the lost territory.