By Omer Farooq BBC correspondent in Hyderabad

The PWG withdrew from previous talks

The government in the southern Indian state of Andhra Pradesh has formally invited the outlawed Peoples War Group (PWG) for talks.

Left wing extremism has been a major problem in the state for the last three decades and the new government has said it is committed to finding a solution.

However, the PWG has demanded more concessions before coming to the negotiation table.

The state home minister K Jana Reddy announced the government's decision to invite the left wing rebels after meeting with a group of civil liberties activists and intellectuals.

Mr Reddy told journalists that the government has urged the PWG to respond to its invitation positively and come out with its agenda.

He said all issues - including the ban on the group - could be covered in the talks.

'No confrontation'

However, the PWG's central committee has demanded the government first declare a formal ceasefire and withdraw rewards on the heads of all the rebels before it comes to the negotiating table.

In response to the latest demands, Mr Jana Reddy said the atmosphere of confrontation between the two sides has been removed after the new Congress government came to power in the state.

He pointed out that the police had already stopped combing operations in the forest areas where the rebels are suspected to be hiding and withdrawn the policy of rewarding its people for killing the rebels.

On the demand for ceasefire, Mr Reddy said there had been no fire from either side for the past two weeks, except for a few minor incidents.

He said the government would constitute a Conciliatory Committee as early as possible to facilitate talks between the government and the PWG.

If the PWG accepts the government's invitation, it will be the second time both sides have come together for talks.

The last time both sides met, communication broke down after three rounds of meetings.

The mediators representing the PWG withdrew from the talks to protest against the killings of the rebel group leaders by the police while negotiations were on.