The year 2008 has witnessed several ups and downs in the relationship between the 27-nation European Union (EU) and Russia.

Ties dipped to a post-Cold War nadir by the Georgia-Russia military conflict in August. But the EU and Russia have managed to steer their relationship in a more positive direction by the end of the year by resuming long-stalled talks on a new partnership deal.

On-again, off-again partnership talks

Russia and the EU agreed in 2005 to work out a new deal to replace the 1994 Partnership and Cooperation Agreement (PCA), deemed as having "really outlived itself" as bilateral ties had developed considerably since then.

However, talks between the EU and Russia on the issue had not been able to start due to strong opposition from Poland and Lithuania.

On June 26, 2008, the two sides announced that they would begin negotiations, formally ending an 18-month deadlock.

The announcement came as Russia lifted an import ban on Polish meat products and Lithuania received EU guarantees on energy supply.

Despite the formal launch of the talks, the road leading up to a new partnership deal has proven bumpy, with negotiations taking place only intermittently in the months to follow.

On Aug. 8, Georgian troops launched a sudden attack against the breakaway region of South Ossetia to reclaim control over the region. Russia reacted the next day by sending in troops, which soon routed the Georgian forces.

At an extraordinary summit on Aug. 26, the EU strongly condemned Moscow for its recognition of the independence of South Ossetia and a second breakaway Georgian region, Abkhazia. The bloc also announced the suspension of negotiations with Russia, saying talks would not resume as long as Russian troops remained in Georgia.

Ties were revived only after Moscow announced the completion of troop withdrawal from the buffer zone adjacent to South Ossetia and Abkhazia on Oct. 8, two days ahead of the deadline set by EU leaders.

Overcoming internal bickering on the matter, the EU restarted negotiations with Russia on Dec. 2.

Challenges remain

As differences over fundamental issues remain between Europe and Russia, bilateral relations are not likely to proceed smoothly, analysts here believe.

While the EU announced the resumption of negotiations with Russia in December, it also stressed that business as usual was not possible against the backdrop of Moscow's recognition of the independence of South Ossetia and Abkhazia and its failure to withdraw troops to their pre-conflict positions.