(Adds leaders signing declaration, comments, colour)
By Denis Dyomkin
MEIENDORF CASTLE, Russia, Nov 2 (Reuters) - President Dmitry Medvedev sought to underline Russia’s influence in the Caucasus on Sunday by bringing together the leaders of Azerbaijan and Armenia for talks on the breakaway region of Nagorno-Karabakh.
Nagorno-Karabakh’s mostly ethnic Armenian population broke away from Azerbaijan in a war in the early 1990s as the Soviet Union collapsed. It now runs its own affairs, with support from Armenia.
Armenian President Serzh Sarksyan and his Azeri counterpart, Ilham Aliyev, hastily shook hands before Medvedev opened talks at the Meiendorf Castle official residence outside Moscow.
After the talks, all three presidents signed a declaration.
"The presidents of Azerbaijan and Armenia agreed to continue work ... on agreeing a political resolution of the conflict in Nagorno-Karabakh," according to a copy of the declaration, which was read out by Medvedev. Aliyev and Sarksyan made no comment.
The war between Russia and Georgia in August appears to have lent new impetus to diplomatic efforts to resolve the Nagorno-Karabakh conflict, with Russia trying to show it can act as a broker for "frozen conflicts" in the former Soviet Union.
Georgia sent troops and tanks in August to retake the pro-Russian rebel region of South Ossetia, which threw off Tbilisi’s rule in 1991-92.
Russia responded with a powerful counter-strike that drove the Georgian army out of South Ossetia. Moscow then recognised South Ossetia and another of Georgia’s rebel regions as independent states, provoking international condemnation.
Nagorno-Karabakh is internationally recognised as within Azerbaijan’s borders.
Armenia supports Nagorno-Karabakh’s split from Azerbaijan and provides assistance though no state — including Armenia — has recognised it as an independent state.
Fighting between Azerbaijan and Armenia over the area ended in 1994 when a ceasefire was signed. The two sides are still technically at war because no peace treaty has been signed.
About 35,000 people on both sides were killed in the fighting. More than a million people were forced to flee their homes and almost all are still unable to return.
Along with France and the United States, Russia is one of the co-chairs of the Minsk Group, which is mandated to act as an intermediary in the Nagorno-Karabakh conflict. But it is unusual for a head of state to act directly as mediator.
The presidents "discussed the perspectives for the resolution of the Nagorno-Karabakh conflict via political means, through the continuation of direct dialogue between Azerbaijan and Armenia with the mediation of Russia, the United States and France as the co-chairmen of the Minsk group."
Armenia is considered Russia’s strongest ally in the Caucasus, but Yerevan is also being courted by the United States and European Union in a struggle with Moscow for influence over a transit route for oil and gas from the Caspian. (Writing by Guy Faulconbridge)