Reform leader, Prime Minister Kaja Kallas told journalists that the sides consider medium-range air defense critical in terms of national defense development. She added that the considerable cost of creating new military capacity speaks in favor of pursuing it with allies.

Commander of the Estonian Defense Forces (EDF) Lt. Gen. Martin Herem was present for talks on Tuesday.

Kallas suggested the coalition aims to help Ukrainian refugees who have reached Estonia.

"We would like to involve more women in internal security," she also said.

Urmas Reinsalu, who led Isamaa's negotiating team, said that Estonia's independent defensive capacity needs to be developed more quickly.

SDE leader Lauri Läänemets said that stronger territorial defense in terms of personnel and the reintroduction of regional police officers were also on the table.

Sides differ on energy prices compensation measures

The parties admitted that the debate on how to compensate people for soaring energy prices is still to come.

"We are looking at a difficult winter in the sense of energy costs. It is clear we have to help people cope. But there are differences in how to go about it. Isamaa want an electricity market reform, while SDE and Reform want to concentrate on those who need help the most. We are looking for common ground and I believe there is room for compromise here," Kallas said.

Lauri Läänemets added that it is important to make sure the agreement will be made before this fall. Kallas added that the parties agree Estonia needs to continue developing LNG handling capacity and that the decision to drop Russian gas deliveries will not be reversed.

Talks will concentrate on forestry, energy and subsistence on Wednesday.

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