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Australia's main base in Afghanistan will close and most of its troops will be home by the end of the year, Defence Minister Stephen Smith said on Tuesday.
The International Security Assistance Force (ISAF), the NATO-led force in Afghanistan, has decided to shut the base in Tarin Kot in Uruzgan province and this meant an end to Australia's main mission.
"With the closure of multinational base Tarin Kot, the majority of Australia's troops will come home from Afghanistan," Smith said in a statement.
The move is in line with Canberra's aim of withdrawing forces in 2013, earlier than planned due to significant security gains.
Australia, a close ally of the United States and whose Afghan deployment began in 2001, still has some 1,550 troops in Afghanistan, mainly in southern Uruzgan, with a focus on training and mentoring Afghan National Army soldiers.
Thirty-nine Australian troops have died in the protracted conflict.