Thai security personnel investigate the site of a bomb attack in southern Thailand's Yala province.

Carnage … the aftermath of a bomb attack blamed on Muslim separatists in Thailand's Yala province last year. Photo: Reuters

BANGKOK: It was to be a brazen attack, even for south-east Asia's most violent conflict.

Fifty heavily armed militants crept towards a fortified marine base in southern Thailand before dawn on February 13, unaware government elite forces had learnt of the attack and set a trap.

When the shooting ended 20 minutes later 16 of the militants were dead, a humiliating blow for insurgent groups fighting a jihad to establish an Islamic state in three Malay-speaking Thai provinces.

Hassan Taib

Senior separatist ... Hassan Taib. Photo: AFP

It appeared the decade-old conflict that has claimed the lives of more than 5200 people remained as intractable as ever amid an increasing number of bombings and shootings, including at government schools.

But what only a few people knew at the time, including those at the highest levels of the Thai and Malaysian governments, was that two weeks later an agreement would be signed for peace talks.

The talks would be ''facilitated'' for the first time by Malaysia, despite deep reservations by Thailand's military and other key agencies which have strongly resisted any foreign involvement in attempts to end the violence, all of which failed.

Visiting Thailand's Prime Minister Yingluck Shinawatra and her Malaysian counterpart Najib Razak shake hands outside Razak's office in Putrajaya, outside Kuala Lumpur, February 28, 2013. REUTERS/Bazuki Muhammad (MALAYSIA - Tags: POLITICS)

The deal is done ... Prime Minister Yingluck Shinawatra, left, and her Malaysian counterpart Najib Razak shake hands. Photo: Reuters

''We need to move forward as soon as possible,'' the Thai Prime Minister, Yingluck Shinawatra, said in Kuala Lumpur late on Thursday, where the Barisan Revolusi Nasional rebel group signed an agreement to take part in the talks.

''I have to say we are seeing a better direction in solving the problem, and I consider it a good start,'' Ms Yingluck said.

It is unclear whether other insurgent groups will agree to join the talks, which Malaysia's Prime Minister, Najib Razak, said would begin in Kuala Lumpur in two weeks, adding the signing was ''merely the starting point of a long process''. For the first time, insurgents have been recognised by the Thai state and for the first time they will have an open forum to discuss their demands.

The Asia regional director for the Geneva-based Centre for Humanitarian Dialogue, Michael Vatikiotis, said Malaysia's involvement was an important step towards resolving the conflict.

''Thailand needed to see the importance of Malaysia playing a role. The conflict was not going to be resolved without Malaysia's participation,'' Mr Vatikiotis said.

''This open process is something the [insurgent] movement will look closely at because it is a sign of sincerity on behalf of the Thai government. The movement is divided on dialogue, but its leadership will engage if Thailand shows sincerity.''

Anthony Davis, a Thai-based analyst at the security consulting firm IHS Jane's, said the talks were a ''major milestone … this is not just business as usual. This confers a level of legitimacy on the armed opposition in southern Thailand, from which realistically there is no going back.''

But the talks may face institutional resistance from Thailand's military, which has 60,000 troops in the south, enforcing a state of emergency. Udomchai Thammasarorat, the commander of the Fourth Army in southern Thailand, said the military had ''nothing to do with the decision''.

''We've opened up other ways to begin dialogue including giving insurgents an opportunity to turn themselves in and fight their case through the Thai justice system,'' he said.

Malaysia's involvement will be modelled on the way it helped broker an agreement between Islamic rebels and the Philippine government last year.

The violence in southern Thailand greatly worries Malaysia and has often strained its relations with Thailand.

The insurgency has long relied on havens and supply networks across the border in Malaysia, but the government in Kuala Lumpur denies funding, arming or providing any other support to militants.

The seeds for the agreement were sown in March last year when Thailand's most famous fugitive, the Prime Minister's brother Thaksin Shinawatra, flew to Kuala Lumpur on his private jet and secretly met insurgent leaders, including the senior separatist figure Hassan Taib, who signed the deal on Thursday.

''God willing, we'll do our best to solve the problem. We will tell our people to work together,'' Mr Hassan said on Thursday.

Mr Thaksin chooses to live in exile rather than return to Thailand where he faces two years' jail on corruption charges.

This week's agreement hung in balance for almost 12 months as Malaysian security agencies disagreed on what role Malaysia should play, sources said.

Analysts said one of the most difficult issues confronting Malaysia would be identifying the leaders of insurgency groups that blend a formal hierarchy with a diverse network of village-based cells.

Marc Askew, an expert on southern Thailand at the University of Melbourne, said that for a long time the Thai military and government figures had been prepared to talk with insurgent representatives but the movement has been ''highly splintered and on occasions individuals pop up their heads to claim a status they simply do not have''.