Congo said on Sunday it would not negotiate with M23 rebels in the east until they pulled out of the city of Goma, but a rebel spokesman said Kinshasa was in no position to set conditions on peace talks.
Congolese President Joseph Kabila met with M23 for the first time on Saturday after an urgent summit in Uganda where regional leaders gave M23 two days to leave Goma, which the rebels seized six days ago after U.N.-backed government troops melted away.
Eight months into a rebellion that U.N. experts say is backed by neighbouring Rwanda, the rebels have so far shown no sign of quitting the lakeside city of one million people.
The rebels say they plan to march on other cities in the east, and then strike out across the country to the capital Kinshasa, across 1,000 miles (1,600 km) of dense jungle with few roads, a daunting feat achieved 15 years ago by Kabila's father.
Amani Kabasha, a spokesman for M23's political arm, welcomed the meeting with Kabila but questioned the government's resolve to end a crisis that risks engulfing the region.
"Why put conditions on talks? You pose conditions when you are in a position of strength. Is the government really in such a position?" Kabasha told Reuters in Goma, which sits on the north shore of Lake Kivu at Congo's eastern border with Rwanda.
Vianney Kazarama, the rebels' military spokesman, said government forces that had been reinforcing along the shores of the lake were now deploying in hills around the rebel held town of Sake and government-held Minova, both Goma's west.
A U.N. source in Minova said government soldiers had gone on a looting spree for a second straight night there. The town was calm on Sunday but gunshots rang out overnight, the source said.
"What is real is that the morale of the troops is very low. They've lost hope in the commanders," the U.N. source said.
The Congolese army has vowed to launch counter-offensives and win back lost territory. The rebels have warned the government against embarking on a "new military adventure".
So far, the unruly and poorly-led army has been little match for the rebels, despite assistance from a U.N. peacekeeping mission that deployed attack helicopters to support the government before Goma fell.
Rebel leaders share ethnic ties with the Tutsi leadership of Rwanda, a small but militarily capable neighbour that intervened often in eastern Congo in the 18 years since Hutu perpetrators of Rwanda's genocide took shelter there. Rwanda has repeatedly denied Congolese and U.N. accusations it is behind M23.
The rebels have not explicitly rejected or accepted the proposals. They are, however, unlikely to cede control of the city or accept government soldiers inside it.
Regional and international leaders are trying to halt the latest bout of violence in eastern Congo, where millions have died of hunger and disease in nearly two decades of fighting fuelled by local and regional politics, ethnic rifts and competition for reserves of gold, tin and coltan.
Kabila was still in the Ugandan capital on Sunday morning but was expected to return to Kinshasa later in the day or on Monday, two Congo government sources said. Kabila's communications chief Andre Ngwej said he did not believe official talks would start in the next few days.
In a statement, the Kinshasa government said Tanzania would take command of the neutral force and that South Africa had offered "substantial" logistical and financial contributions towards it. The Kampala plan did not say what the consequences would be if the rebels did not comply.