The Sri Lankan army completed its latest offensive against Tamil rebels in an operation code-named "Watershed" - probably because it was thought it was going to be the final battle before monsoon rains this year.

But before the celebrations could begin, the Tiger rebels have turned the tables on government forces by mounting what is turning out to be the bloodiest battle in 14 months.

Army base after army base has fallen to the advancing Tiger rebels since Tuesday.

The government's military strategy is in tatters. The morale of troops has has hit rock bottom.

Military setbacks

After sacrificing hundreds of lives, government troops are back to where they started over a year ago.

Usually, heavy military losses are quickly forgotten in Sri Lankan where many accept the seemingly unending war as a way of life.

However, the main opposition is already turning the military debacle into a political issue.

Opposition leader Ranil Wickremisinghe is putting pressure on the government

Any further escalation of fighting and greater losses could affect President Chandrika Kumaratunga's re-election hopes at the 21 December election.

As the bodies of hundreds of government soldiers are taken to the south of the country where the majority Sinhalese community is concentrated, President Kumaratunga may find it difficult to use the peace plan that propelled her to power five years ago.

After her talks with Tiger rebels ended in failure in April 1995, Kumaratunga mounted what is known as a war-for-peace strategy, that is proving disastrous both politically as well as militarily.

Elections

President Kumaratunga is promising peace once again, but this time she says it will be achieved within a couple of months of her re-election.

The election itself was called about a year before schedule in an apparent attempt to arrest the declining popularity of Kumaratunga's ruling People's Alliance coalition.

However, analysts say that mounting deaths among government forces and more losses of territory may even encourage the governing party to postpone the election citing security reasons.

President Kumaratunga used the Tamil separatist war to postpone local elections that were due in August last year but the supreme court intervened to restore the vote.

Her party won those elections but with a considerably smaller margin signalling the erosion of support for her party.