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ISTANBUL (Reuters) - At least one Turkish soldier was killed and another wounded in clashes with Kurdish militants in eastern Turkey as tensions escalated, local media reported, potentially undermining government efforts towards direct peace talks.

A group of fighters from the Kurdistan Workers' Party (PKK) fired at a military border patrol unit near the Iran border in the eastern province of Van. A Turkish lieutenant was killed, and another soldier was injured in the clash late on Tuesday, according to Turkish media.

A Kurdish protester was shot dead and two others were wounded in southeastern Turkey earlier on Tuesday as they clashed with security forces dismantling a newly erected statue of a prominent Kurdish militant.

The PKK, considered a terrorist group by Turkey, the European Union and the United States, waged a three-decade insurgency to push for greater Kurdish rights, but hostilities have largely died down since a March 2013 ceasefire.

Turkey began peace talks with jailed PKK leader Abdullah Ocalan in late 2012, and last month parliament approved a legal framework for the process for the first time, an important step towards ending the insurgency.

Ocalan told pro-Kurdish lawmakers visiting him at the weekend that the PKK's war with the Turkish state was nearing an end.

Prime Minister and President-elect Tayyip Erdogan has made the Kurdish peace process one of his priorities.

Yet the flare-up in violence could harm efforts by the government to push for direct negotiations with rebels.

Deputy Prime Minister Besir Atalay told a television channel on Tuesday the government may hold direct talks with the armed guerrillas, also known as Qandil, the mountain range of northern Iraq where they are based.

"I desire direct talks between our yet-to-be-formed team and Qandil," Atalay told NTV news. "If necessary, our state institutions may talk to Qandil in some other places as well ... For the maturation of the action plan, any kind of necessary meetings could take place, within the legal framework."

Negotiators will propose a plan, including for militants' withdrawal, disarmament and the return to Turkey of some PKK members, he said.

"Later, these people will lead normal lives inside Turkey. We want Turkey to be a normal country. That's all we want," Atalay said.

(Writing by Ece Toksabay; Editing by Ayla Jean Yackley and Susan Fenton)

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