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The Arakan Army says it has taken control of Paletwa, in Chin State, a key trading post with India.
Violent clashes between the Tatmadaw and the Arakan Army in the Chin state early this month triggered the exodus.
An unofficial ceasefire has kept Rakhine State quiet compared to much of Myanmar following the 2021 coup. But friction is building between the military and ethnic Rakhine fighters. The parties should strike a formal deal to avert a return to war.