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Last Updated: Friday, 24 June, 2005, 12:02 GMT 13:02 UK
Sri Lanka's controversial tsunami deal

By Dumeetha Luthra
BBC correspondent, Colombo

Tsunami reconstruction work in Sri Lanka
The money is to be used in areas under rebel and government control
So finally, nearly six months after the Indian Ocean tsunami devastated much of Sri Lanka, the government and the powerful Tamil Tiger rebel movement have signed an agreement on how to disburse $3bn of promised international aid.

The deal was originally put forward in the immediate aftermath of the disaster. It was seen then as a plan to unite the country in the face of tragedy.

The idea was to set up a mechanism that guaranteed that the aid would reach areas under both government and Tamil Tiger control.

But the proposal, rather than unifying, has proven to be divisive and hugely controversial.

Hardline opposition

Initially, wrangling between President Chandrika Kumaratunga's government and the Tamil Tigers served to underline the legacy of mistrust from 20 years of civil war.

When a deal was finally hammered out, it appeared that it would be scuppered from within the president's own government.

Her main ally, the hardline nationalist People's Liberation Front (JVP) remained vehemently opposed to it.

President Chandrika Kumaratunga
President Kumaratunga has worked for a consensus

It argued that such a deal would legitimise the rebels and undermine Sri Lanka's sovereignty.

Last week the party withdrew its 39 members from the coalition leaving President Kumaratunga with a fragile minority government and a real possibility of elections in the next few months.

The JVP also mobilised thousands of people on to the streets in protest, as did the influential Buddhist clergy which is equally opposed to the Tigers.

The anger escalated into clashes, with saffron robed monks trying to storm President Chandrika Kumaratunga's residence, with police using tear gas and water cannon to disperse the crowds.

Under pressure

The president has been in a difficult position.

Having tied herself so firmly to the aid deal, and under international pressure to push ahead, she has been working to cobble together some sort of consensus.

Friday's debate in parliament had been expected to provide her with a broad swathe of cross party support for the deal, even though it does not need to be ratified by parliament.

Instead JVP members stormed in with black flags - signifying this as a day of mourning - and outside police fired tear gas on JVP supporters and Buddhist monks.

The chaos resulted in the debate being postponed.

Hopes of stability

The signing of the aid deal by the government and the Tamil Tigers comes as a huge relief for the international community.

Many are hoping that the deal can now put the country and the peace process back together

It now provides a way of allocating long term co-ordinated relief to victims of the tsunami in the rebel-held areas.

Many donors have the Tamil Tiger rebels on their international terrorist lists and would not fund them directly.

The deal is also seen as a way of creating stability on the island.

The east has been increasingly volatile since the defection of a top Tamil Tiger commander last year, with factional fighting and political killings.

There has been a real fear that a failure to provide substantial assistance to tsunami victims in that area could lead to further unrest.

Peace monitors say the three year old ceasefire is already stretched.

Crucially both the president and the rebels have signalled that the deal could open the door to restarting the deadlocked peace process.

Talks between the government and Tamil Tiger rebels have been stalled for two years.

It has been a long time coming, but many of Sri Lanka's future hopes rest on this deal working.

Last December Sri Lanka suffered a huge disaster.

Many are hoping that the deal can now put the country and the peace process back together.

The details of the deal


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