After initial Liberation Tigers of Tamil Eelam (LTTE) accusations of government aid misappropriation, series of LTTE-government talks brought sides close to agreed mechanism for equitable distribution of tsunami relief. Although negotiations did not cover peace process, high-level Crisis Group sources advise of real confidence- building significance, with situation having moved considerable distance from “no peace, no war, no talks” status quo. Meanwhile, UNICEF and Human Rights Watch accused LTTE of recruiting tsunami orphans. Over 38,000 killed, 1 million displaced by 26 December tsunami.

Devastating 26 December tsunami killed estimated 30,000, mainly in disputed north and east. Longer term implications for conflict as yet unclear, but despite some reported attempts by LTTE to politicise aid delivery, early signs are of cooperation between government and LTTE, and return to open conflict seen as unthinkable in immediately foreseeable future. Pre-tsunami, Norwegian peace envoy Erik Solheim pessimistic after meeting head of Liberation Tigers of Tamil Eelam political wing 15 December. Hardline Sinhala Marxist JVP party and coalition partner of President Chandrika Kumaratunga’s government main obstacle to talks with Tamil rebels on permanently ending civil war. Grenade attack at Colombo concert 12 December killed 2; LTTE denied responsibility.

Situation remains fragile as Liberation Tigers of Tamil Eelam (LTTE) leader Velupillai Prabhakaran said he had “reached the limits of patience”. Sinhala and Tamil communities clashed Trincomalee after 28 November grenade attack on bus left 1 dead; LTTE denied responsibility. Despite high-level visit by Norwegian foreign minister Jan Petersen, efforts to restart talks between President Kumaratunga’s government and LTTE failed. Kumaratunga reiterated her government’s principles for finding solution: “a united Sri Lanka, undivided, human rights to be guaranteed, political pluralism.” Chief LTTE peace negotiator Anton Balasingham said solution with present government impossible. LTTE insist talks be based on their blueprint for self-rule. High court judge Sarath Ambeypitia, responsible for 2002 sentencing of LTTE leader Velupillai Prabhakaran to 200 years prison, shot dead with bodyguard 19 November.

Peace process remained stalled and sporadic factional violence continued. Liberation Tigers of Tamil Eelam (LTTE) repeated position that talks can go forward only on basis of Interim Self-Governing Authority plan. Breakaway LTTE leader V. Muralitharan, a.k.a. Karuna, reportedly launched new political movement, Tamil Eelam People's Liberation Tigers party, 12 October. President Kumaratunga inaugurated National Advisory Council for Peace and Reconciliation 4 October as all-party forum for peace process, boycotted by opposition parties and dismissed by LTTE as time-wasting tactic. Opposition United National Party led by former PM Ranil Wickremesinghe indicated possibility of conditional support for government should they initiate peace talks with LTTE.

Factional violence worsened as latest Norwegian attempts to rekindle peace process failed. Brother of breakaway rebel leader V. Muralitharan, a.k.a. Karuna, killed with 3 others 23 September; Liberation Tigers of Tamil Eelam (LTTE) denied responsibility. At least 12 LTTE rebels killed in 25, 28 September factional clashes. Eelam People's Democratic Party (EPDP) protestors left coffin containing remains of EPDP politician Thambithurai Sivakumar at Norwegian embassy gate 20 September, demanding action from Norwegian mediators.

Risk of escalation in violence remains as politically motivated killings continued. Top Liberation Tigers of Tamil Eelam (LTTE) politician, along with senior member of Eelam People’s Democratic Party allied with President Chandrika Kumaratunga, among those assassinated. Ceasefire remained hostage to split within LTTE: northern leadership accuses military intelligence of supporting breakaway rebel leader V. Muralitharan, a.k.a. Karuna, in attacks against northern-based LTTE rebels. President Kumaratunga stepped down as leader of ruling United People’s Freedom Alliance (while remaining president), reportedly to spend more time on peace process with LTTE. Talks resumed: Norwegian envoy Eric Solheim met LTTE negotiator 31 August; LTTE leaders and military to meet 3 September to discuss security situation.

Tension increased as violence erupted in capital. February 2002 ceasefire increasingly fragile following 8 July Colombo suicide bombing, which killed 4 police officers. Attack reportedly aimed at Hindu Affairs Minister Douglas Devananda, who had publicly said was in contact with breakaway rebel leader V. Muralitharan, aka Karuna. Tamil Tigers (LTTE) denied responsibility for bombing, but warned that Sri Lankan military connections with Karuna jeopardising peace process. Eight Karuna aides killed in Colombo safe house 25 July. Almost daily killings of Karuna supporters continued in eastern province. LTTE leaders renewed calls for their October 2003 proposal for Interim Self Governing Authority to be basis for restart of peace talks. In surprise move President Kumaratunga indicated she would hold talks on LTTE proposal but coalition partner, leftist People’s Liberation Front, threatened to pull out of government. Talks unlikely to resume until feud over rebel split resolved. Norwegian mediation efforts unsuccessful to date.

Peace process remained stalled. 2002 ceasefire between Tamil Tigers (LTTE) and government at risk as latter admitted elements of military unofficially supported breakaway LTTE rebel commander V. Muralitharan, aka Karuna. LTTE political wing leader S.P. Thamilselvan told Norwegian envoy Erik Solheim 30 June peace process would not go forward. President Kumaratunga’s government 5 seats short of simple majority, unable to press ahead with legislative agenda.

After months of political turmoil peace process remains stalled. Norwegian envoy Erik Solheim met with government, Tamil Tigers (LTTE) and President Kumaratunga, but no date set to restart talks. New government wants to discuss final settlement to end war, while LTTE want their Interim Self-Governing Authority Proposal, submitted in October 2003, to be implemented before talks begin. People's Liberation Front (JVP) opposes devolution of power to LTTE, controls over third of minority government's seats. Sporadic violence continued in northeast killing at least 15. Tamil leader Karuna still on run after splitting from main rebel group in March.

President Kumaratunga's United Peoples Freedom Alliance (UPFA) emerged 8 seats short of absolute majority in 2 April parliamentary elections. Veteran politician Mahinda Rajapakse appointed PM. Ministries of defence (incl. responsibility for peace process), constitutional affairs and education retained by Kumaratunga. Early stand-off between government and new coalition partner, leftist People's Liberation Front (JVP), resolved. JVP hold 39 of 105 seats won by UPFA in 2 April polls. Government reportedly going ahead with proposals to replace presidential system of government with parliamentary one, and change electoral system - despite losing key post of speaker of parliament by single vote. Norway to resume mediator role; delegation scheduled to meet Kumaratunga 2 May, and leader of LTTE political wing, Sinniah Paramu Tamilselvan, 3 May. Violent clashes between breakaway rebel commander Karuna's forces and main LTTE killed at least 9; Karuna since disappeared. Further fighting 26 April killed 7. Over 1,000 child soldiers reportedly released or demobilised in April. Argument between Sinhalese and Tamils became full-scale riot 28 April in Central region.