"We must win the war in Afghanistan. The alternative is to risk that country's return to its previous function as a terrorist sanctuary, from which Al Qaeda could train and plan attacks against America," McCain said on Tuesday at the prestigious American Enterprise Institute, a Washington-based think tank.

Delivering a major foreign policy speech on Afghanistan, McCain said not winning the war in Afghanistan would constitute an historic success for the jihadist movement.

"It would severely damage American standing and credibility in a region that already doubts our resolve, and threaten the future of the North Atlantic Treaty Organisation," he said in his speech, his first one on Afghanistan after the November presidential elections which he lost to Barack Obama.

"A terrorist sanctuary in Afghanistan would encourage and enable Al Qaeda and other terrorist groups to destabilise neighbouring countries," he said.

Broader insecurity in Afghanistan, with the violence, refugee flows, and lawlessness it would engender, could spill beyond its borders to nuclear armed Pakistan or other states in south and central Asia, with the gravest implications for US national security, McCain apprehended.

As the Obama Administration is currently reviewing the US policy on Afghanistan, McCain said as of now nothing is moving in a right direction in Afghanistan.

"In Afghanistan today, we are not winning. Let us not shy from the truth, but let us not be paralysed by it either," he said, adding that nearly every indicator in Afghanistan is heading in the wrong direction.

Not only civilian fatalities have increased dramatically as security has deteriorated, the number of insurgent attacks was higher every single week in 2008 than during the same week in 2007.

"Since 2005, violence has increased over 500 per cent, and despite the presence of tens of thousands of coalition troops, growing portions of the country suffer under the influence of the Taliban," he said.

Arguing that all efforts should be made to win the war in Afghanistan, McCain disagreed with those who now say that it is better to scale down the American goals in the country.