"Government had not indicated it was ready to resume talks on ISGA"

Tamilselvan, who met the Japanese envoy in Tiger-controlled territory in the north of Sri Lanka, said the government had not indicated it was ready to resume talks on the proposal for an Interim Self-Governing Authority (ISGA).

He said if there was no ISGA, then it would be up to the Tiger leader Prabhakaran to decide what to do next. Tamilselvan returned to Sri Lanka on Monday after spending a number of weeks in Europe.

An LTTE delegation led by him on a mission to promote the ISGA proposed by the Tamil Tigers as the basis for future negotiations.

It also has been requesting donor agencies to step up aid to non governmental organisations (NGO) of the area.

Major aid donor

Japan is Sri Lanka's main financial backer providing the majority of foreign funding.

An aid package worth $4.5bn was agreed at a donor's conference in Tokyo last year.

But the money is tied to progress in the peace process and so far no funds have been released.

Speaking to the press after meeting the LTTE political head the Japanese envoy said that aid given by Japan for the rebuilding of Iraq will not affect granting aid to Wanni.

However, he added that not re entering the negotiation table will have an adverse effect on funds to the war torn North and East.