Gunning down of a police official by Maoists in Malkangiri district has cast a shadow over talks to end the nine-day-old Italian hostage crisis with a senior official saying the killing has put a question mark on the sincerity of the ultras.

A police sub-inspector was killed on Thursday at a busy market place in broad day light by the ultras at Khairput in Malkangiri district.

A senior government official on Friday said the killing has raised many questions over the 'sincerity and intention of the Maoists to resolve the crisis when talks were going'.

Maoist mediators also condemned the killing of the police officer during the ongoing negotiation process. They asked the rebels to refrain from violence as it could affect the progress of talks.

As all the 13 demands of the ultras came up for discussion during the first phase of talks last evening, the Maoist mediators claimed that the two abducted Italians were in good health and safe.

The negotiators nominated by the ultras are former bureaucrat and social activist B.D. Sharma, and Dandapani Mohanty, while Odisha government was represented by Home Secretary U.N. Behera, Panchayatiraj secretary P.K. Jena and ST & SC Secretary S.K. Sarangi.

Modalities for safe release of Puri-based tour operator Paolo Bosusco and tourist Claudio Colangelo, who were taken hostage on March 14 from Kandhamal district while trekking, are likely to be worked out soon, Mohanty said.

"All 13 demands made by the abductors were discussed threadbare as the three government negotiators showed a positive approach during talks," Mohanty and Sharma said.

The demands put forward by the Maoists included release of some rebels, including Subhashree Das, wife of top Maoist leader Sabyasachi Panda, and Gananath Patra and action against police officials allegedly involved in fake encounter.

The Maoists also demanded that tribals must not be used as objects for promotion of tourism. They also suggested that steps be taken to bring one of the three jailed Maoist leaders, Narayan Sanyal, Amit Bagchi and Kobad Gandhi, lodged in jails at Giridih, Vishakhapatanam and Tihar to Bhubaneswar to monitor talks. The state government is likely to convey its views on this shortly, Mohanty said.

The rebel mediators stressed that one of the Italian hostages could be released if two of their demands were met.

The two demands include release of some ultras including Subhashree Das and action against police officials allegedly involved in fake encounters.

The other Italian would be released when all the 13 demands are settled, they said. On the release of the hostages, Sharma and Mohanty said the modalities would be discussed and decided at the appropriate level.

"A clear picture will emerge when talks proceed further," Sharma said. Chief Minister Naveen Patnaik said that Italian Ambassador Giacomo Sanfelici di Monteforte had spoken to him again and expressed concern for the two hostages.

"He spoke again of the anxiety and distress of the families of the two Italian nationals," Patnaik said asking the Maoists to release the two immediately.

The Odisha Assembly in a resolution also appealed to the abductors to release the two Italians held captive by them since March 14.

Rallies and processions were held in different parts of Odisha by people belonging to various sections of society asking the Maoists to release the hostages.