European Union leaders have agreed to postpone talks with Russia on a new partnership pact scheduled for later this month if Moscow has not withdrawn its troops to pre-conflict positions in Georgia by then.
The decision at an emergency summit in Brussels came after Russian Foreign Minister Sergei Lavrov hailed Moscow's military intervention over the breakaway South Ossetia conflict as setting a new standard for defending its national interests.
The EU move was a bid to bridge broad differences between its 27 states on how to deal with Russia and came after the bloc dropped talk of sanctions on its largest energy supplier.
'It is clear that, in the light of events, we cannot continue as if nothing had happened,' European Commission President Jose Manuel Barroso said.
French President Nicolas Sarkozy will travel to Moscow on 8 September to verify whether Russia had fully adhered to a peace plan in time for the next round of partnership talks set for 15 September in Brussels, he said.
The new EU-Russia accord is due to regulate relations in the energy sector and on trade.
Russian officials have in the past been less than enthusiastic about the long-delayed pact.
'We don't need these talks or this new agreement any more than the EU does,' Russia's envoy to the EU Vladimir Chizhov said.
Separately, German Chancellor Angela Merkel said Russia had signalled that it was prepared to withdraw its troops to pre-conflict positions in neighbouring Georgia.
Ms Merkel said Russian President Dmitry Medvedev made the statement in a telephone call with Mr Sarkozy yesterday.
Moscow has withdrawn most of its forces in line with a ceasefire deal but has kept soldiers in "security zones", which include Georgian territory around South Ossetia and Abkhazia.
Western capitals demand Moscow pull its troops to pre-conflict positions, as it agreed under a French-brokered peace plan.
The Kremlin says the troops are peacekeepers needed to protect the separatist regions from new Georgian aggression.
A final summit statement strongly condemned Russia's move to recognise the independence of the rebel regions of South Ossetia and Abkhazia and urged other countries not to follow the step.
Taoiseach Brian Cowen and Minister for Foreign Affairs Micheál Martin attended the summit.
Thousands of Georgians stage protest
Ms Merkel said that while the EU must speak clearly over the crisis, the bloc should not cut off dialogue with Russia - a major source of oil and gas for Europe.
The Kremlin ordered tanks and troops into Georgia to push back a Georgian offensive on 7 August to retake South Ossetia, a separatist region that broke away from Tbilisi in the early 1990s with Moscow's backing.
Mr Medvedev upped the stakes last week by recognising the independence of South Ossetia and a second separatist region Abkhazia, drawing fierce criticism from the West.
Hundreds of thousands of Georgians poured into the capital today to take part in what officials called the biggest protest in the country's history against the Russian action.
'Georgia is united as never before, there are one million people on the streets,' President Mikheil Saakashvili told a huge crowd on Freedom Square in the capital that was awash with the red crosses of the national flag.
'Georgia will never stop resisting, Georgia will never surrender!' he added.
EU aims to send observers - Solana
Huge posters depicting images of dead and injured from last month's fighting against Russia hung from buildings along the protest route.
Simultaneous protests took place in several other towns - and in European capitals - against Russia's partial occupation of Georgia and its recognition of the two separatist provinces.
Mr Solana said the bloc hoped to launch an observer mission to Georgia within weeks - although where they would be able to operate remained unclear.
He said an exploratory mission of around 40 people now was on the ground.
Russia indicated it would support an international police mission to Georgia to help maintain security around the two breakaway regions.
'Such a presence could be deployed under a mandate of the OSCE (Organisation for Security and Cooperation in Europe) with the support of the European Union,' foreign ministry spokesman Andrei Nesterenko told journalists.
Russian FM rejects arms embargo
Mr Medvedev has been unrepentant, warning that Moscow was ready to retaliate against sanctions and that there was no turning back on his decision to recognise Georgia's rebel regions.
Russian Foreign Minister Sergei Lavrov warned against any attempts to break the close relationship between Russia and Germany and said it was Georgia not Russia that should be subject to an arms embargo.
Mr Saakashvili portrayed the Georgian military assault on South Ossetia as a pre-emptive strike.
In an interview published today by the Swedish daily newspaper Dagens Nyheter, he alleged that Russia had been meticulously planning its military action.
Many critics have said Georgia brought the incursion on itself by attacking South Ossetia.
