Foreign Secretary William Hague began a landmark visit to Myanmar on Thursday to get a first-hand view of encouraging reforms being pursued by its civilian leadership, but officials said he would set out conditions for the lifting of sanctions.

The two-day visit by Hague is the first by a British foreign minister since the military seized power in 1962.

As the former colonial power, a visit by a British cabinet minister is seen as one of the most significant diplomatic initiatives since an army-backed civilian government embarked on a series of reforms last year.

Britain has maintained a tough stand on human rights issues in the former Burma, but expressed guarded optimism after the release on October 12 of 230 political prisoners, with freedom for remaining hundreds a key demand by the West for the lifting of sanctions.

Hague arrived in Naypyitaw, the capital built in secret six years ago, where he will meet president and former junta general Thein Sein on Thursday. He will travel to the main city, Yangon, and is due to hold talks on Friday with Oxford-educated pro-democracy leader and Nobel peace laureate Aung San Suu Kyi.

This visit ... has been made possible by the encouraging recent steps taken by the Burmese government, Hague said in a statement.

I am visiting the country to encourage the Burmese government to continue its path of reform and to gauge what more Britain can do to support this process.

His trip follows one late last year by U.S. Secretary of State Hillary Clinton, who promised concrete support from Washington if Myanmar released more political prisoners and made more concessions, including dialogue with ethnic separatists.

Britain will seek similar proof of good faith, a British official said in London before Hague left.

It would push within the European Union for the easing of sanctions if there was substantial progress on three benchmarks: the release of all remaining political detainees, the holding of free and fair by-elections in April and bringing ethnic groups into the mainstream political process, he said.

Just 12 political detainees were thought to have been freed this week among 900 prisoners freed as an Independence Day gesture. As many as 600 may remain behind bars.

In a speech carried in Wednesday's state media to mark the former Burma's independence from Britain on January 4, 1948, Thein Sein warned of powerful nations seeking to impinge on the independence and sovereignty of weaker countries -- comments typical of the ultra-nationalist junta regime.

BALANCING ACT

The visit is a tricky balancing act for Hague, who will face criticism at home if he is seen as appeasing a government stacked with former members of the military regime slammed for its human rights record and brutal suppression of dissent.

Rights violations by the army are still reported from areas where the army and ethnic groups are fighting.

Hague can't appear to go soft. The Burma issue has become a political football at home and if he's not forthright, he will be criticised, said Derek Tonkin, a prominent Myanmar analyst and former British diplomat.

But there's a feeling that we have been battering away at the Burmese for 22 years and not got anywhere. Britain is very much under the influence of the Americans, he said, noting Britain's discouragement of trade, tourism and investment was far heavier than that of the EU in general.

Both the European Union and United States have voiced qualified support for the new government and Myanmar's neighbours in Asia, especially India, Thailand and China, are rushing to snap up deals to build infrastructure and invest in natural resources including oil, gas, gemstones and timber.

British firms in the energy and financial services sectors in particular are believed to be interested in Myanmar, but Hague's visit is likely to be little more than a testing of the water before the EU holds its annual sanctions review in April.

He could discuss possible inducements such as development aid or humanitarian assistance, which, if supported by Suu Kyi, could placate his staunchest critics at home.

She has shown a willingness to compromise in recent months, notably by agreeing to run as a candidate in an April by-election after letting her party re-enter the political process.

Hague could offer some small concessions but at the moment, he's there to deliver the message that lifting economic sanctions requires more genuine reforms, said Mark Farmaner, director of the UK Burma Campaign.

Britain will be very careful. There's broad support for engagement, but I don't think they'll move too fast, he added, noting that reforms could take a long time.

(Additional reporting by Adrian Croft; Editing by Alan Raybould and Ed Lane)