US embassy cable - 03COLOMBO90

C O N F I D E N T I A L SECTION 01 OF 04 COLOMBO 000090 
 
SIPDIS 
 
DEPARTMENT FOR SA, SA/INS, INR/NESA; NSC FOR E. MILLARD 
 
LONDON FOR POL/RIEDEL 
 
E.O. 12958:  DECL: 01/14/13 
TAGS: PGOV, PTER, PINR, PHUM, CE, IN, LTTE - Peace Process 
SUBJECT:  Key GSL minister reviews status of peace 
process, including security zone issue and Indian role 
 
Refs:  Colombo 75, and previous 
 
(U) Classified by Lewis Amselem, Deputy Chief of 
Mission.  Reasons 1.5 (b,d). 
 
1.  (C) SUMMARY:  In a January 13 meeting with the 
Ambassador, Milinda Moragoda, a key GSL minister, 
reviewed the status of the peace process.  At the recent 
talks, he said, the LTTE had pressed hard on the Jaffna 
security zone issue.  An agreement was not reached, but 
the two sides agreed to keep working on the matter.  For 
the first time, the two sides discussed timelines, with 
the GSL indicating it wanted a final settlement much 
sooner than the LTTE.  Moragoda, who had just returned 
from New Delhi, also expressed concern over what he 
considered GoI divisions over how to handle Sri Lankan 
policy.  Based on Moragoda's comments, much of the low 
hanging fruit has been picked and he expects the peace 
process to become increasingly difficult.  END SUMMARY. 
 
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A Pensive Moragoda 
------------------ 
 
2.  (U) The Ambassador and DCM met January 13 with 
Milinda Moragoda, the Sri Lankan Minister of Economic 
Reform and a key player on peace process issues. 
Moragoda had just returned to Colombo from India (see 
Para 10) and before that Thailand where he had 
participated in the fourth round of GSL talks with the 
Liberation Tigers of Tamil Eelam (LTTE) (see Reftels). 
Before Bangkok, Moragoda had also been in Japan for 
several days. 
 
3.  (C) Moragoda was pensive.  He also seemed very tired 
and -- in a rarity for someone who usually has his act 
together -- a bit disorganized.  Our guess is that the 
heavy travel schedule had worn Moragoda down, but the 
weight of all the issues he was dealing with also 
appeared a factor.  (Note:  Moragoda has his hand in 
virtually everything the government does, political, 
military or economic.)  Discussing how busy he was, 
Moragoda commented that Prime Minister Wickremesinghe 
was planning a cabinet reshuffle soon and his 
(Moragoda's) portfolios might be slimmed down.  If that 
happened, Moragoda noted, he would be very happy. 
(Note:  We have no further information about any cabinet 
reshuffle.  In past conversations, Moragoda has 
discussed possibly giving up his economic-related 
responsibilities, so that he can concentrate on the 
peace process.) 
 
---------------- 
The Fourth Round 
---------------- 
 
4.  (C) Providing a brief readout of the recently 
concluded talks, Moragoda indicated that they had gone 
relatively well.  The big issue had been how to handle 
the Sri Lankan military's "high security zones" in 
Jaffna.  The LTTE had pressed very hard for a reduction 
in the size of the security zones.  For its part, the 
GSL had stressed that it could not agree to do this 
without a symmetrical and verifiable Tiger commitment to 
disarmament of cadre that might enter military-vacated 
areas.  (Note:  The Tigers have refused to discuss 
disarmament at this time.)  Given the disagreement over 
the security zone issue, the two sides had ultimately 
decided to focus on resettling displaced persons (IDPs) 
who had points of origin from outside the area of the 
camps.  (Note:  The government estimates that about 
300,000 IDPs are from Jaffna areas located outside of 
the camps and 40,000 are from inside areas that are now 
taken up by the camps.  The LTTE disputes these 
figures.) 
 
5.  (C) In the meantime, Moragoda noted, the two sides 
had also agreed to continue discussing the security 
zones.  At this time, both sides were waiting for a 
report being prepared by Satish Nambiar, a retired 
Indian general, on the issue.  (Note:  Moragoda said 
Nambiar had been asked to prepare the report by the GSL. 
Nambiar, he added, was being paid by the Indian 
government, with some expenses reimbursed by the Sri 
Lankan government.)  The government was getting 
indications that Nambiar's report would "split the 
difference," i.e., providing for some relocations and 
reductions in the security zone network, but not 
outright withdrawal. 
 
6.  (C) Looking at how the security zone issue was 
handled, Moragoda concluded that the government had 
probably made a mistake in releasing the military's 
proposal on the security zone issue publicly before it 
was provided to the LTTE.  (Note:  The military's 
report, which was prepared by Jaffna Army commander 
Major General Fonseka, was publicized in late December 
-- see Reftels)  The report had clearly angered the 
Tigers, who found it inflexible.  They also objected to 
its use of terms like "terrorist" when referring to the 
LTTE.  The use of such terms had led the Tigers to 
accuse the GSL of not exercising control over the 
military.  Moragoda commented that the report was the 
"proximate cause" of the Tiger decision to withdraw from 
the "Sub-Committee on De-Escalation and Normalization." 
(Note:  The LTTE announced earlier this month that it 
would no longer participate in this sub-committee, 
preferring to discuss security issues in the political- 
level talks.  The decision was a setback for the peace 
process.) 
 
--------------------------------- 
Timeline of a Possible Settlement 
--------------------------------- 
 
7.  (C) On the margins of the talks, Moragoda related 
that he had had an interesting colloquy with LTTE senior 
negotiator Anton Balasingham on timelines for a possible 
final settlement of the conflict.  This was the first 
time the two sides had discussed this issue, he 
confided.  Moragoda said he told Balasingham that the 
government wanted to wrap things up as quickly as 
possible, preferably within the next 6-8 months. 
Balasingham replied that the LTTE had a much longer 
timeline in mind, stretching two-and-a-half years.  The 
LTTE negotiator indicated that this timeline was 
predicated on a point where President Kumaratunga was 
out of office or on her way out.  (Note:  Kumaratunga's 
term ends in early 2006, with the next presidential 
election slated to take place in December 2005.)  The 
LTTE, Balasingham indicated, did not trust her and did 
not want a final settlement agreed to when Kumaratunga 
still was in any position to undermine it. 
 
8.  (C) In explaining the different timelines, Moragoda 
went on to add that the Tigers appeared quite satisfied 
with the on-the-ground pace of the peace process.  The 
government, however, felt the need to show political 
gains in ending the war, in addition to moving forward 
with improvements in the on-the-ground situation. 
 
9.  (C) Queried about Balasingham's health, Moragoda 
replied that he did not look good.  Moragoda said he 
(Moragoda) was really worried about the future of the 
peace process if something happened to Balasingham.  It 
was not clear whether the LTTE had anyone available who 
could take his place.  (Note:  Balasingham has had a 
long-standing kidney condition, which requires constant 
medical attention.  Concerns about his health have 
reportedly led to the postponement of Balasingham's 
planned trip to LTTE-controlled northern Sri Lanka, 
which was slated to begin after the conclusion of the 
recent talks.) 
 
------------------ 
Visit to New Delhi 
------------------ 
 
10.  (C) Shifting gears, Moragoda provided a brief 
readout on his recent visit to India.  In New Delhi, he 
said he had briefed GoI officials, including External 
Affairs Minister Sinha and National Security Advisor 
Mishra, on the outcome of the talks.  Moragoda felt that 
his meetings had gone well and that India was on board 
with the peace process.  That said, Moragoda expressed 
concerns over what he saw as a disconnect in the GoI 
over how to handle policy toward Sri Lanka.  According 
to Moragoda, the MEA seemed to favor a "go slow" 
approach, not wanting the GoI to take too prominent a 
role as regards Sri Lanka.  Mishra, however, seemed to 
want India to assume a more energetic posture.  Moragoda 
said he was not sure how the apparent difference in 
emphasis would shake out, but it potentially could prove 
problematic for Sri Lanka down the road.  Per Reftels, 
Moragoda added that GoI officials continued to express 
concerns about Japan's heightened interest in Sri Lanka. 
The recent visit of Foreign Minister Kawaguchi to New 
Delhi had not allayed Indian concerns about the GoJ's 
higher profile, he said. 
 
------------ 
Other Issues 
------------ 
 
11.  (C) The meeting also touched on the following 
issues: 
 
-- Cohabitation:  Regarding the always-testy 
relationship between the government and the president, 
Moragoda said he was scheduled to brief Kumaratunga on 
peace process issues fortnightly.  He felt that 
Kumaratunga's attitude toward the peace process was 
highly ambiguous:  she did not want to be seen as 
opposing the process, but she also wanted to keep the 
government off-balance, so as to gain political 
advantage. 
 
-- Muslim Meltdown:  Moragoda could not conceal his low 
opinion of Rauf Hakeem, the Sri Lanka Muslim Congress 
(SLMC) leader.  Hakeem was a poor politician who had 
alienated virtually everyone, including the Prime 
Minister.  In fact, Moragoda said he could now count at 
least four separate SLMC factions.  Hakeem had made a 
hash out of his participation in the fourth round of 
talks, earning a stern lecture from Balasingham, who 
warned him to stop interjecting so-called "Muslim 
issues" into the talks.  (Note:  Hakeem was re-elected 
leader of the SLMC shortly after his return from the 
Thailand talks.  Only pro-Hakeem SLMC delegates were 
allowed to attend the party meeting where the election 
was held.) 
 
-- Donor Conference:  The international donor conference 
hosted by Japan would take place June 15-16. 
 
-- UN Voting:  He reacted in a positive manner to a 
request that the U.S. and the GSL work together to 
improve Sri Lanka's UN voting record.  He said he would 
call Permrep Mahendran in New York on the issue and 
report back. 
 
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COMMENT 
------- 
 
12.  (C) Based on Moragoda's comments, much of the low 
hanging fruit has been picked and he clearly expects the 
peace process to become increasingly difficult.  In our 
estimation, he could well be right.  The way forward 
will probably be particularly rough for the GSL, which 
is at pains to show some sort of "peace dividend" to its 
constituents.  The LTTE, of course, does not have 
similar worries given its authoritarian ways.  In 
addition, per Moragoda's straightforward statement to 
Balasingham that the government wants to come to terms 
as soon as possible, the LTTE probably has a legitimate 
reason to feel that it has the upper hand at this point. 
Indeed, Moragoda seemed to indicate to us that the GSL 
was not going to go to the mat over the security zone 
issue.  At the same time, handling the negotiations is a 
difficult calculus for the LTTE.  If it really wants the 
process to work, the LTTE cannot afford to embarrass the 
government too much.  That would only redound to the 
advantage of those who are skeptical about the peace 
process in the south.  In light of these confusing ins 
and outs, it is no wonder that Moragoda seemed tired and 
out-of-sorts.  That said, the GSL leadership is going to 
have to rise to the occasion in the coming months if it 
is going to see the process through.  END COMMENT. 
 
13. (U) Minimize considered. 
 
WILLS