He also reportedly said a deal with the Taliban might be on the table.
"If the Taliban were prepared to sit on the other side of the table and talk about a political settlement, then that's precisely the sort of progress that concludes insurgencies like this,'' Carleton-Smith was quoted in The Sunday Times newspaper as saying.
The inclusive approach appeared to be echoed by General Abdul Rahim Wardak, Afghanistan's defence minister, who said the idea that Afghanistan had to find political solutions to end the fighting had long been endorsed by Hamid Karzai, the president.
"For a total solution we must work on different fronts - political, economic and military," Wardak said on Sunday at a news conference.
"Economically, we must improve the lives of the people, help find them work. Politically, we need to reach a middle ground and have everyone accept the Afghan constitution," he said.
'Destined to fail'
Britain and its Nato allies are engaged in a fierce campaign against Taliban fighters in Afghanistan, following the US invasion of the country in 2001, which toppled the Taliban government.
Carleton-Smith said foreign forces had "taken the sting out of the Taliban for 2008" but that it would be "unrealistic and probably incredible" to think that the multinational forces in Afghanistan could rid the country of armed groups.
"We may well leave with there still being a low but steady ebb of rural insurgency ... I don't think we should expect that when we go, there won't be roaming bands of armed men in this part of the world," he was quoted as saying.
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"The American strategy is destined to fail"
Sherard Cowper-Coles, UK ambassador to Kabul
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Britain has about 7,800 troops in Afghanistan.
Qari Yusuf Ahmadi, a spokesman for the Taliban, told Al Jazeera that Carleton-Smith's comments showed that the conflict could be ended only by foreign troops leaving Afghanistan.
He also reaffirmed that the movement rejected any compromises with the government, such as accepting ministry portfolios or taking control of the country's southern states.
Mullah Abdul Salam Zaeef, the Taliban's former envoy to Pakistan, told Al Jazeera that it is a positive sign that international forces have made this admission.
"This is the reality - Nato forces will not win the war in Afghanistan, and I think it is good they confess to that," he said.
"If they want a solution in Afghanistan, they must talk to all of the Taliban and the Taliban leadership with no conditions. This war is not the choice of the Taliban or the Afghan people, but we are fighting to bring stability to the country."
Abdul Rahim Wardak, the Afghan defence minister, on Sunday acknowledged that the conflict could not be ended by a military solution alone, saying that the Taliban must be brought to the negotiating table.
"To resolve the conflict, we need to improve the economic situation in the country, eliminate unemployment, along with reaching a peaceful political settlement with Taliban," he said at a news conference in the capital Kabul.
'Western humiliation'
"This is, of course, after Taliban's acceptance to the Afghani constitution and the peaceful rotation of power by democratic means."
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The British government has denied it believes the Afghan campaign is hopeless [EPA]
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Dan Plesch, an Afghanistan analyst from the School of African and Oriental Studies in London, told Al Jazeera that Western powers involved in Afghanistan could be defeated.
"The Western military powers have to face the serious issue of defeat here, it may well be that the Pashtun-led Taliban movement could defeat international forces," he said.
"We need to consider that [Osama] bin Laden in launching 9/11, he and his compatriots may have anticipated, and indeed invited American intervention, wishing to draw them into their territory and defeat them like they did with the Soviets.
"Nato and US forces may be staring defeat in the face over the course of next few years, and we need to think about how a Western humiliation in Afghanistan would impact on us."
Leaked correspondence
On Saturday, the British government denied a claim that the UK believes the military campaign in Afghanistan is doomed to failure, after a French newspaper reported that London's ambassador to Kabul had said foreign troops were adding to Afghanistan's problems by helping keep in place a failing government in Kabul.
France's weekly Le Canard Enchaine had published what it said was a leaked French diplomatic telegram recounting talks between Sherard Cowper-Coles, the British ambassador to Kabul, and a French official.
The newspaper quoted Cowper-Coles as saying that "the American strategy is destined to fail" and that Afghanistan might best be "governed by an acceptable dictator".
The newspaper, a weekly publication known for its investigative stories, published excerpts of the telegram, including a passage that quoted the British ambassador as criticising both US presidential candidates over pledges to send more troops to Afghanistan.
"It is the American presidential candidates who must be dissuaded from getting further bogged down in Afghanistan," an extract of the telegram published by the newspaper quoted Cowper-Coles as saying.
The newspaper said it had obtained a copy of the two-page telegram, which it reported was sent from Kabul to Paris on September 2.
It said the telegram was written by Jean-Francois Fitou, France's deputy ambassador in Afghanistan, following his meeting with Cowper-Coles.