The plan provides for the deployment of "effective international civil and security presences" endorsed by the United Nations, to secure Kosovo after the withdrawal of Serb forces.

The foreign ministers of the G8 - which comprises the UK, Canada, France, Germany, Italy, Japan, US and Russia - adopted the plan at their meeting in Bonn, Germany.

The BBC's Nicholas Witchell: Nato leaders describe today as a breakthrough

They also want to return refugees to their homes and set up an administration approved by the UN Security Council.

Mr Clinton said the plan was a "significant step forward, but it's a long process". He said Nato would continue with its current strategy and "aggressively continue" air attacks.

Stephen Sackur's report includes an interview with President Clinton

Russia had been coming under increasing pressure to agree a framework to end the conflict.

BBC Correspondent Caroline Wyatt said the agreement suggested Nato forces might be deployed in Kosovo but would not be led by them.

Russian Foreign Minister Igor Ivanov, answering questions after the agreement was announced, said Nato could not participate in an international security presence in Kosovo without Yugoslavia's agreement.

"We have written in the principles that we guarantee the sovereignty of Yugoslavia. Without the agreement of that state, nothing is possible," he said.

John Simpson in Belgrade: Mr Milosevic's men are already claiming victory

US Secretary of State Madeleine Albright reiterated that Nato forces - including US troops - must be at the core of any international force deployed.

Nato spokesman Jamie Shea said: "A lot of hard work still has to be done, but I believe this meeting in Bonn will be a very important stage in finally bringing the crisis in Kosovo to an end."

Caroline Wyatt in Bonn: With Russia now apparently onside what will Belgrade's response be?

President Clinton, speaking earlier in Germany, said he would welcome Russian participation in any international force.

He also said he thought President Milosevic was moving closer to Nato's demands for resolving the conflict.

Nato says the bombing will continue, and says it has wiped out 20% of the Yugoslav army's tanks and artillery in Kosovo, and more than half of its ammunition stocks.

The alliance said all but two of the bridges across the Danube - outside Belgrade - had been destroyed.

President Clinton said there could be an agreement without Mr Milosevic being forced from power. The alternative, he said, would be for the international community to declare war and march on Belgrade, which had never been its aim.

President Clinton: "A determined effort to destroy records of people's presence in Kosovo"

He told refugees at the Ingelheim camp that what had been done could not be undone, but they had not been "forgotten or abandoned".

"You will go home again in safety and freedom," he told them.

Kosovo leader in Italy

Mystery surrounds Yugoslavia's decision to allow the moderate Kosovo Albanian leader Ibrahim Rugova to travel to Italy.

Ibrahim Rugova (left) with the Italian prime minister

Mr Rugova, who has reportedly been living under house arrest in Pristina, was taken to Rome with members of his family on an Italian Government plane.

He went straight into talks with Italian Prime Minister Massimo D'Alema.

The moderate leader has been calling for an end to Nato military action and a peaceful solution to the Kosovo crisis, but western governments say he has been under the control of Belgrade.

Italian officials described Mr Rugova's foreign trip as an important signal from President Milosevic that should not be ignored.

(Click here to see a map of last night's Nato strikes)

The Yugoslav media says Nato forces continued their air strikes on Wednesday night, attacking fuel depots in the southern Serbian city of Nis.

The Yugoslav news agency Tanjug said a medical storage facility was also destroyed and residential property damaged.

Macedonian border closed

The US Government has appealed to the Former Yugoslav Republic of Macedonia to re-open its Blace border crossing.

Hundreds of Kosovo refugees were prevented from entering the country after the border was shut on Wednesday.

Rageh Omaar explains why Macedonia has closed its border crossing with Yugoslavia

Officials have demanded that Western governments do more to share the refugee burden immediately.

Macedonia, a tenth of whose population is now Kosovo refugees, says it will allow in only as many as the West airlifts out of the country.

• Macedonia 'using refugees as lever'
• Rugova calls for peace force
• Bill Clinton's visit in pictures
• Full text of peace principles
• Kosovo Albanians: Who's left?