BRUSSELS, August 5, 2008 (AFP) - The French EU presidency on Tuesday expressed 'grave concern' at the upsurge of tension in Georgia's separatist region of South Ossetia.

'We deplore the loss of lives and numerous injuries caused by recent incidents,' the EU presidency, currently held by France, said in a statement.

'The European Union is willing, more than ever, to fully engage in the pursuit of a peaceful settlement of the conflicts in Georgia... and again calls for moderation and the swift resumption of the negotiations,' the statement continued.

A Georgian government spokeswoman told AFP that Georgian and South Ossetian officials have agreed to hold direct talks on Thursday for the first time in a decade amid tensions in the mountain province.

South Ossetia has evacuated hundreds of women and children to Russia over the past few days after six people were killed on Friday by sniper and mortar fire from Georgian positions, the rebel province's government said.

Georgia has denied readying for war and said there is no major evacuation.

South Ossetia broke away from the rest of Georgia after the Soviet collapse of 1991 in a conflict that killed thousands of people.

Russia has given the separatist province diplomatic and economic support, including granting citizenship to most of its residents.

The EU presidency statement said that observers from the Organisation for Security and Cooperation in Europe mission based in South Ossetia had recently been targeted.

It urged all parties concerned to cooperate fully with the OSCE 'which plays a major stabilising and mediation role.'

Meanwhile a top Russian diplomat warned that Moscow would defend its citizens living in South Ossetia and a South Ossetian official said militias in the region were preparing for war, Russian media reports said.