WASHINGTON : The Afghan government's peace deal with a notorious Islamist warlord is an "encouraging" step in the effort to resolve the country's conflict, the commander of US-led international forces in Afghanistan said on Friday.

Afghan officials signed a peace deal on Thursday with a party led by Gulbuddin Hekmatyar, a move that inspired both hope and fear as it dredged up tensions dating back decades.

The militant faction of Hezb-i-Islami, led by Hekmatyar, has been battling to establish an Islamic state in Afghanistan.

"This is positive in the sense that this represents a group that is residing largely outside of Afghanistan that is now reaching a reconciliation agreement with the government which will eventually involve a reintegration into Afghan society," Army General John Nicholson told reporters at the Pentagon. "This is one of the most important steps we see towards an eventual resolution of the conflict in Afghanistan," Nicholson said.

Compared to other militant groups like the Taliban or Islamic State, however, Hezb-i-Islami has played a relatively small role in the insurgency recently, and analysts say the accord is mostly symbolic.

Peace talks with the Taliban, the largest insurgent group, have yet to get off the ground, but both sides have said they are open to the idea.

Nicholson said about 10 percent of territory in Afghanistan was controlled or influenced by the Taliban, with up to another 25 percent being contested.

He added that he was concerned about the high level of casualties among Afghan forces and had been working with Afghan leaders to adjust tactics to reduce them.

Chairman of the Joint Chiefs of Staff General Joseph Dunford told a US Senate hearing this week that the security situation in Afghanistan was at a "stalemate" amid concerns about the Afghan security forces' capabilities.