Taliban gunfire and a rocket-propelled grenade had just struck a joint US-Afghan base on Route Red Dog, near the southern Afghan city of Kandahar. An ammunition store blew up and an Afghan soldier was wounded by shrapnel.

The insurgents rode off on motorbikes. But as darkness fell, they attacked another outpost. From two miles away, I heard American paratroopers firing more than 1,000 rounds back. Afghan soldiers on a hill behind us opened up with heavy machinegun fire, right over our heads.

It was the Taliban’s first direct attack this year on American bases in Arghandab valley, northwest of the city — the first shots of what many soldiers believe will be the decisive battle of President Barack Obama’s troop surge in Afghanistan.

The paratroopers of 2nd Battalion, 508th Parachute Infantry Regiment, from the 82nd Airborne Division, have faced a largely hidden enemy since they arrived just before Christmas. Within days a chain of improvised explosive devices (IEDs) killed a company commander, Captain Paul Pena, and another soldier. The leader of the platoon I joined lost a leg.

Last week, however, the Taliban were moving into the open. A suicide bomber who attacked one patrol killed only himself. But as spring warmth and irrigated water restore the vegetation to this valley of grapes and pomegranates, the opportunities flourish for insurgents to mount ambushes.

“This is going to be quite a hunting season,” said a paratrooper, one of nearly 20,000 foreign and Afghan soldiers committed to the forthcoming offensive.

Many are guarding the approaches to Kandahar, which is not only Afghanistan’s second city, with a population of more than half a million, but is also the spiritual home of the Taliban.

While the focus of most recent fighting in southern Afghanistan has been on the neighbouring province of Helmand, where British troops are based, Kandahar was long left largely to a contingent of a few hundred Canadian troops. According to commanders of the Nato-led International Security Assistance Force (ISAF), this inattention contributed to a steady deterioration of security.

In the city, residents describe a pervasive fear resulting from assassinations, intimidation and suicide car bombs.

In much of the surrounding countryside, the Taliban are either in open control or have threatened government officials to the point where they are too afraid to open schools or clinics.

Describing the forthcoming campaign at his bustling Kandahar airport base, Major-General Nick Carter, the British head of Nato’s southern command, revealed that his approach would be radically different in the city and the countryside.

In the countryside, Nato and Afghan units will push into new territory to restore government authority “where perhaps none exists”, Carter said. It is here that his commanders expect the heaviest fighting.

Nato’s combat power will be boosted by two new American brigades, the 2nd Brigade of the 101st Airborne Division and the 1st Brigade of the 10th Mountain Division.

The RAF Regiment will play a role in securing Kandahar airfield and British special forces are in the region to launch raids on top targets.

US and other foreign troops will mostly be kept out of Kandahar city, however, as Carter strives to avoid urban warfare. The emphasis there will be on police action — roadblocks, security checks and controls on militias and weapons.

“You are not going to see a whole lot of ISAF soldiers stomping around the city. That’s not what the Afghans want,” Carter said.

For the famously cerebral general, the key mission in the months ahead will be not so much killing rebels but starting to address some of the causes of their rebellion. He therefore prefers not to call his campaign a battle. “I am not talking about an operational offensive,” he said. “I’m talking about an assertion of credible government.”

Carter regards political reform and confronting corruption as critical. Among his problems, observers say, is Ahmed Wali Karzai, the head of Kandahar’s provincial council and President Hamid Karzai’s brother.

Sources close to General Sher Mohammad Zazai, the Afghan army corps commander in Kandahar, say he is afraid to drive into the city because he believes he may be killed by men loyal to Ahmed Wali. A feud between the two men is said to have begun when Zazai seized a cache of Karzai’s weapons. The atmosphere of distrust between senior figures has allowed the Taliban to gain support.

Carter said that, working with the Afghan government, he was promoting a plan to create local precinct councils that could counter the dominance of certain tribes in the region.

“Ultimately, the answers will all run back to Kabul,” he said. “President Karzai will know how he wants to resolve the problems of Kandahar.”

While Carter stresses political solutions, however, the Taliban may try to undermine them by provoking the pitched battle that Nato wants to avoid in the city. Fighters are said to be storing weapons around Kandahar, including in market stalls.

Haji Sahib Ahmad, a businessman, said the Taliban had secured a firm foothold in the city. “People are very worried about the war coming to their street,” he said. “The Taliban will resist and many innocent civilians will be killed by the Americans… The war will not solve anything.”

The paratroopers of the 82nd Airborne have worked hard to win over the people of the surrounding area, walking almost everywhere and living among the villagers in small bases.

Compared with British soldiers in Helmand, the Americans in Kandahar have a huge amount of money to spend. Each platoon has a discretionary pot of $25,000 (£16,700) a month for local supplies and $15,000 to help the Afghan police and army. American soldiers are providing medical treatment for children and funding the rebuilding of several mosques. “We’re doing a whole lot of stroking,” said Jeremiah Mason, a platoon sergeant.

On a hilltop with sweeping views of the city, Lieutenant Jordan Ritenour, the 23-year-old platoon leader, pointed round in a full circle. “I mean, there’s Taliban there, there’s Taliban here, there could be Taliban in that house right there,” he said, looking straight down.

He pointed out one village where a wife of Mullah Omar, the Taliban leader, used to live. Further down the Arghandab valley is the village of Sangesar, Omar’s former home, where, in the village’s white mosque, the founding meeting of the Taliban movement was held in 1994. Sixteen years later, the Taliban are not expected to cede this ground without a fight.

Ritenour also indicated a twist in an alleyway below us where the IEDs that killed the previous company commander were detonated. Nearby is a school he had been trying to reach that day. The school has been refurbished but lies empty because, villagers say, the children fear it will be attacked.

At a meeting the next day, local elders swore they had seen no Taliban. “There’s a contradiction in what you’re saying,” Ritenour told them. “You say it’s safe and secure round here and no one supports the Taliban. But you say also the children are too afraid to go to school.”

Many soldiers struggle with a broader question: what difference will all the handouts make to winning the war? Will they secure hearts and minds or is it more likely that in Afghanistan, as one paratrooper put it, “any act of kindness is taken as an act of weakness”.

As the thousands of troops prepare to spread out across the region — fighting and then sticking around to live among the people — the answer may determine whether Obama’s surge ultimately succeeds or fails.

‘Give the insurgents a role’

Pakistan’s military command has told the US that the Taliban must be part of any future government in Afghanistan if the war is to be brought to an end, writes Christina Lamb.

“The conflict won’t end if you don’t give a role to the main player,” a senior official told talks in Washington when the Pakistani delegation brought a 56-page list of demands for aid ranging from power stations to spy planes.