Gordon Brown: "If at all possible we should set a timetable"
Gordon Brown says he hopes control of some areas of Afghanistan can be handed over from 2010, raising the prospect of the eventual withdrawal of UK troops.
The prime minister wants to host a Nato meeting in January to "set a timetable" for transfer to full Afghan control.
But Downing St said it would not be an "exit" summit - just an opportunity to discuss future strategy.
The BBC's Gordon Corera said while some districts might be ready, handover in others like Helmand was years off.
He said the key reference in Mr Brown's Lord Mayor's banquet speech was for the planned transfer of power to be done "district by district".
The speech was seen as a message to the public that the war in Afghanistan was not an endless campaign and its goals were achievable, following heavy casualties among British troops over the summer.
It followed the announcement that a member of the Royal Engineers was killed by an explosion in Helmand province on Sunday: the 97th UK serviceman to be killed in Afghanistan this year.
By James Robbins, diplomatic correspondent, BBC News
Gordon Brown must hope that his clearest pointer so far to an eventual way out of Afghanistan for Britain's frontline forces will quieten calls for an immediate pull-out.
The prime minister very deliberately made clear his hope that the process of handing security control in Afghanistan to the country's own security forces should begin in 2010, with crucial decisions to be taken at an international conference he wants to host early in the new year.
But the prime minister also made clear that he regards Britain's military presence as vital to protect ordinary people at home from plots hatched in Pakistan by al-Qaeda extremists, who would spread back into Afghanistan if allowed the opportunity to do so.
The prime minister said the security services in Britain were reporting to him that there was now an opportunity to inflict significant and long-lasting damage on al-Qaeda.
Foreign Secretary David Miliband is expected to say more about the prime minister's plans in a speech to the Nato parliamentary assembly in Edinburgh at 1100 GMT.
In his speech on Monday evening the prime minister said he was urging President Karzai to "set out the contract between the new government and its people, including early action on corruption".
He added: "The international community will meet to agree plans for the support we will provide to Afghanistan during this next phase. I have offered London as a venue in the New Year.
"I want that conference to chart a comprehensive political framework within which the military strategy can be accomplished.
"It should identify a process for transferring district by district to Afghan control, and if at all possible we should set a timetable for transferring districts starting in 2010."
Mr Brown has acknowledged that al-Qaeda is not operating in Afghanistan but cautioned that it continued to recruit and train.
"Al-Qaeda rely on a permissive environment in the tribal areas of Pakistan and - if they can re-establish one - in Afghanistan," Mr Brown warned.
He said there were "several hundred" foreign fighters still based in the tribal areas of northern Pakistan, attending training camps to learn bomb-making and weapons skills.
'Sapping' al-Qaeda morale
The group continued to operate "an extensive recruitment network across Africa, the Middle East, western Europe - and in the UK", he added.
"Al-Qaeda had links to the Afghan and Pakistan Taliban before 2001; we must deny terrorists the room to operate which the Taliban regime allowed the 9/11 attackers," he argued.
He warned that al-Qaeda was the "greatest current risk to UK lives" but said there had been "unprecedented successes against its leadership this year".
"Since January 2008 seven of the top dozen figures in al Qaida have been killed, depleting its reserve of experienced leaders and sapping its morale," he said.
Earlier this month, Kim Howells, chairman of the influential intelligence and security committee, became the most senior Labour figure to call for British troops to be pulled out of the Nato-led International Security and Assistance Force (ISAF).
The former Foreign Office minister called for the majority of UK forces to be brought home to concentrate on protective measures to prevent terror attacks in the UK. But Mr Brown rejected this argument in his speech, saying: "At every point in our history where we have looked outwards, we have become stronger.
"And now, more than ever, there is no future in what was once called 'splendid isolation'."
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