Lawmakers met in Parliament on Monday for the first time since violence surged last month in East Timor, trying to find a political solution as gang warfare and arson erupted again in the capital.
The leader of more than 2,000 peacekeeping troops said more police, not combat forces, were needed to get "criminals off the streets."
Jose Ramos Horta, the Nobel Peace Prize-winning defense and foreign minister, met Monday with several commanders of 600 East Timorese troops who were dismissed in March, triggering the current crisis.
The meeting was meant to explore "all-inclusive talks" leading to a lasting resolution of the political crisis, the Defense Ministry said in a statement.
Ministry spokesman Chris Santos said Ramos Horta and the rebel commanders "had a good talk." He declined to give details.
Horta did not meet with the most prominent rebel leader, Alfredo Reinado, but Horta's office said they would hold talks in the next day or two.
Thirty-eight of Parliament's 88 members did not attend Monday's legislative session. Colleagues said some stayed away because they feared for their safety or lacked transport.
But Speaker Francisco Guterres, a leader of the ruling Fretilin party, urged authorities to investigate the missing lawmakers' whereabouts. The session ended without no firm resolution.
Some East Timorese blame Fretilin's leader, Prime Minister Mari Alkatiri, for the turmoil and are demanding his ouster.
In March, Alkatiri dismissed the 600 striking soldiers, who clashed with loyalist troops and fled to the hills. In the absence of security forces, rival gangs took to the streets, looting and setting fires.
Alkatiri sought outside help, and peacekeepers from Australia, New Zealand, Malaysia and Portugal have started operations in the past 10 days.
On Monday, Australian forces fired tear gas to disperse dozens of rock-throwing youths at a bridge near the airport in the capital, Dili.
Elsewhere in the city, a gang set ablaze a row of houses near an old market. They were burning freely when Australian soldiers arrived.
Despite the flare-ups, violence has dwindled since the arrival of the peacekeepers, including 1,300 front-line Australian forces as well as scores of Australian federal police and Portuguese paramilitaries.
Australia Defense Minister Brendan Nelson, who earlier warned that East Timor could become a haven for terrorists and other criminals if the government fails, said Monday he expected other Asian countries would soon contribute to a bolstered security force.
The troops have taken up guard posts at key buildings and roads in the capital, and confiscated hundreds of machetes, slingshots and other weapons from gang members.
But they have mostly not sought to root out the troublemakers, many of whom fade into alleyways when patrols come by.
The commander of the Australian peacekeepers, Brig. Mick Slater, said more police were needed, not troops.
"It is about getting criminals off the streets, and police do that better than soldiers," Slater told reporters in Dili.
Australia has suggested a long-term U.N.-backed security force is needed in East Timor.
In Parliament, one lawmaker expressed concern about reports of weapons caches in his district. Another asked for security to escort him to future meetings.
"Without any security we cannot do anything," said lawmaker Antonio Cardozo.
At least 30 people have died and an estimated 100,000 have fled their homes in Dili in the last month. Many are staying in squalid camps inside and outside the city.
It is the worst violence in East Timor since its bloody breakaway from Indonesia after 24 years of often brutal occupation in 1999, when pro-Indonesian militias devastated much of the territory.
Indonesian President Susilo Bambang Yudhoyono on Monday warned that Alkatiri's allegation, made last week, that militia members involved in the 1999 violence are stoking the current unrest could cause fresh problems between East Timor and its giant neighbor.
"I regret the statement by East Timor Prime Minister Mari Alkatiri, which could become a new problem between the governments of Indonesia and East Timor," Yudhoyono told reporters in Jakarta.
A U.N. High Commission for Refugees cargo plane arrived early Monday with 220 tents and 1,000 plastic sheets, said UNHCR spokeswoman Ariane Rummery. She said it was unclear when people would return to their homes.
The Philippines sent an air force transport plane to evacuate more of its citizens.