Kabul plans to take charge of the "majority of operations in the insecure areas of Afghanistan within three years and taking responsibility for physical security within five years," according to the final communique unveiled at the end of Thursday's Afghanistan Conference in London.
In individual provinces, Afghan authorities will assume the lead in security operations by late 2010 or early 2011, with NATO forces retreating to a supporting position.
Karzai ahead of the conference had warned that his troops would need training and support from the West for another "five to 10 years," with financial aid to pay them required for the next 15 years.
"This is a decisive time for the international operation that is helping the Afghan people secure and govern their own country," British Prime Minister Gordon Brown said at the opening of the conference, attended by representatives from some 70 countries and international organizations. "This conference marks the beginning of the transition process -- agreeing the necessary conditions under which we can begin, district by district and province by province, the process of transferring responsibility for security from international forces to Afghan forces."
To achieve this, the West plans to boost its police and military training efforts, with the Afghan army due to grow by nearly 70,000 troops to a force of 172,000 by October 2011, and the police force to reach a size of 136,000.
In addition, Western nations have pledged some $1.6 billion in debt relief and promised Kabul it will get more aid directly once it gets rid of corruption. Individual nations also promised a moderate military surge, with Germany pledging to add another 850 troops to its contingency of 4,500.
"The aim of the conference was to align the military and civilian resources of every coalition partner behind a clear political strategy," the BBC quoted British Foreign Secretary David Miliband as saying.
While roughly 150,000 NATO troops from 44 nations are trying to defeat the Taliban insurgency on the battlefield, more recent concepts call for the carrot instead of the stick.
Hamid Karzai, the president of Afghanistan, said reconciliation was key to end the conflict in his country.
"We must reach out to all of our countrymen, especially our disenchanted brothers," he said in a reference to the Taliban.
U.S. Secretary of State Hillary Clinton said Washington shared the notion that careful reintegration of insurgents could work.
"Many low- and mid-level Taliban are driven to extremism more by economic opportunity or local politics than by ideology. With the right incentives, they can become part of Afghan democracy," she said.
The incentive could be money: Governments in London pledged $140 million for the first year of a program to win over Taliban fighters and integrate them into society.
The final communique pledged that former Taliban would be offered an "honorable place in society" if they agreed to "renounce violence, participate in the free and open society and respect the principles that are enshrined in the Afghan Constitution" and "cut their ties with al-Qaida and other terrorist groups and pursue their political goals peacefully."