"Shali has filled a resume that would turn others olive drab with envy, " Clinton said.

CNN: Clinton Bids Goodbye To Retiring Military Chief

General Kazantsev said 16 Russians had been killed and 25 wounded in fighting in Argun and Shali in the past 24 hours.

BBC: Russian forces 'have made mistakes'

"The rest are now making attempts to break the encirclement and get out of Shali and make their way towards the mountains, " he said.

BBC: Russian forces 'have made mistakes'

Earlier, Russian commanders admitted they lost 26 men in the rebel counter-attacks against Argun and Shali - the highest casualty figures they have given in the campaign so far.

BBC: Russian forces 'have made mistakes'