A week after Sri Lanka's new president assumed office, the two sides in the country's long-running ethnic conflict have drawn their lines in the sand.
Rebel leader Prabhakaran wants a settlement within the next year
Mahinda Rajapakse, the country's new president who is backed by hardliners opposed to any concession to the Tamil Tiger rebels, stated his position to the stalled peace process in his first speech to parliament on Friday.
He rejected outright any demands for a separate Tamil homeland and also indicated that he would look to renegotiate a ceasefire that has been in place since February 2002.
He also said a previous tsunami aid-sharing deal with the Tigers - currently halted by a Supreme Court order - would be scrapped and a new administrative mechanism introduced.
Both sides have taken up positions so far from the middle ground that any serious chance of peace must surely be questioned
On Sunday, the reclusive leader of the Tigers, Velupillai Prabhakaran, used the occasion of a rebel war memorial day to give the government an ultimatum.
He said he would give the new president until next year to frame a political solution to the conflict, failing which the Tamil Tigers would "intensify" their struggle.
Although he said this was the rebels final appeal, many observers will be relieved that Prabhakaran stopped short of declaring a return to war.
But despite the fact that there is no immediate threat of hostilities, both sides have taken up positions so far from the middle ground that any serious chance of peace must surely be questioned.
Sri Lanka's closely fought presidential election has left the country clearly divided along ethnic lines.
Mr Rajapakse, who was backed by the hardline Janatha Vimukthi Peramuna
(JVP) and the Jathika Hela Urumaya (JHU), a party made up of Buddhist monks, received strong backing from the majority Sinhala-Buddhist community, particularly in the south.
President Rajapakse wants a major revamp of the peace process
His opponent, Ranil Wickramasinghe, was supported by the country's minority Tamils and Muslims.
But a vast majority of the Tamils, particularly in the north and east, failed to vote - largely because the Tamil Tiger rebels enforced an unofficial boycott.
It is quite apparent that Mr Wickramasinghe, who lost by 180,000 votes, would have easily won the election if the Tamils had voted.
Most analysts believe that the rebels' opposition to Tamil participation in the elections was strategic.
In the northern town of Jaffna - government-controlled but with a Tamil majority - as well as in the rebel-held Vanni region - the belief is that the rebel leadership wanted it to be clear that the new president was the choice of the Sinhala majority even if that resulted in a president who was clearly opposed to any concessions to the Tigers.
But others suggest it was a show of strength, a signal to the Sinhala hardliners that the rebels matter and would have to be reckoned with in any solution whether political or military.
As for the new president, there are those who believe that until fresh elections change the composition of parliament, Mr Rajapakse will have to rely on the support of the JVP and JHU - and therefore maintain a hardline position.
Certainly, in his first major political speech after winning the elections, the president kept to the script that was evident in his campaign:
No self-government or separate homeland for the Tamils
- A redrawing of the ceasefire agreement
- No to a tsunami-aid sharing deal
- No major role for Norwegian peace brokers
But he also added a few other elements that would have caused the Tamil Tigers some unease.
He said that the peace talks would be broad-based and not merely be confined to the rebels and the government.
It is clear to many that Mr Rajapakse is arguing that the rebels are not the sole representatives of the Tamils.
However, this approach fails to address the fact that the rebels are in effective control of parts of the north and east and, short of a military conflict, are unlikely to concede any ground.
But the president has also indicated that other international parties, including India and the United Nations, could be drawn into the negotiations.
The role of India is something that will also raise eyebrows in Sri Lanka.
There are certainly some who believe that the country's influential northern neighbour should be drawn in, especially as it has a large Tamil state itself.
But most have very unhappy memories of India's intervention in Sri Lanka in the late 1980s, when the country sent troops into the country in a failed attempt to maintain peace.
More importantly, the president's hardline ally, the JVP, has been bitterly opposed to India's role in the past and is likely to look at any new attempt with suspicion.
So where does Sri Lanka go from here?
The rebels control most of the north and east
While there is no immediate threat of war, there have been frequent clashes especially in the east, a steady level of violence that will probably increase.
More recently, the assassination of the country's foreign minister has served to remind the government that the threat of violent killings has not completely diminished, even though the rebels denied having a hand in the murder.
For their part, the Tamil Tigers have signalled their growing frustration at what they see as the attitude of the major parties in the south to the peace process.
Tamils, they believe, are unlikely to get their due from the majority Sinhalese and have given up hope.
But there are some who question whether the rebels are keen on giving up their fight for self-rule, even though they dropped the demand for a separate Tamil homeland in earlier rounds of peace talks.
The next few months are going to be critical for the two major negotiating parties as they gauge each others positions and determine their next move.
In the worst possible case, it could signal a return to war.