Sri Lanka ban stays on Tamil rebels

COLOMBO, Sri Lanka -- Sri Lanka says it will not lift a ban on the rebel Liberation Tigers of Tamil Eelam (LTTE), which the rebels have been demanding before direct peace talks can start.

"There will be no lifting of the ban. It is not even being considered. Not even temporarily," Justice Minister Batty Weerakoon told Reuters.

Norway, which trying to negotiate an end to the 18-year ethnic war, has reported progress on two other rebel demands -- a truce and the easing of an economic embargo on rebel-held areas.

"The removal of the proscription of the Liberation Tigers is an essential prerequisite for talks," rebel negotiator S.P. Thamilchelvam told Norwegian envoy Erik Solheim during a meeting last week.

Weerakoon said progress in the peace process would now depend on the rebels and Norway. "It's now up to the other side and the skill of the facilitator," he said.

The ban, imposed by the government in 1998, has been the subject of intense media speculation in the past few days with many independent newspapers reporting hopes of a compromise.

But having apparently moved on the other rebel demands, the government, which has lobbied hard to have the rebels outlawed in other countries, has held firm on the ban.

The LTTE, which depends on an extensive international fundraising network to finance its campaign for a separate minority Tamil state in Sri Lanka's north and east, is listed as terrorist group in several countries including the United States, Britain and neighboring India.

But one analyst said the deadlock should not prove fatal to Norway's efforts to end the conflict that has claimed an estimated 64,000 lives since 1983.

"The situation is not hopeless. The parties can find a way out by putting de-proscription early on the agenda for talks," said Kethesh Loganathan, an analyst at the Colombo-based Centre for Policy Alternatives.

Reuters contributed to this report.