Foreign aid donors on Monday warned Sri Lanka against a military solution to the island's drawn out ethnic conflict and said the government must enter into a power-sharing deal with Tamil Tigers.
The United States, Japan and the World Bank came out strongly against any military action to resolve the conflict which has already claimed over 60,000 lives.
"We remain unwavering in our conviction that there can be no military solution to this terrible conflict," US Ambassador Robert Blake said at the opening of a two-day meeting here to review foreign aid to the island.
"We hope Sri Lanka will seize the opportunity to forge a power-sharing proposal that can form the basis for talks with the LTTE that could finally bring an end to conflict in Sri Lanka," he said in the presence of President Mahinda Rajapakse.
The World Bank's South Asia vice president Praful Patel said the country's future depended on ending the Tamil separatist conflict peacefully.
"There is no way to politely skirt this issue," Patel said.
"As a major development partner to Sri Lanka, the World Bank would be failing if we did not place the conflict front and center in our deliberations for it is this that constrains the country's development and stands in the way of its tremendous potential."
He warned that this year will be a difficult one for Sri Lanka unless the government addressed the issue of runaway inflation currently at over 19 per cent.
"If inflation continues at the current levels of nearly 20 per cent, 2007 will not be a good year for the economy," Patel warned.
Japanese ambassador Kiyoshi Araki warned that Sri Lanka's "future was at stake." He said the conflict must be resolved through dialogue and not violence.
Japan is Sri Lanka's largest single aid donor.
President Rajapaksa asked the international community to fund rehabilitation work in areas where the military had captured from Tamil Tigers.
The president also vowed to build on military gains and subdue the rebels.
The US ambassador was also critical of the Sri Lankan authorities for blocking access to international non-governmental organisations (NGOs) in areas where troops had stepped up attacks against the Tigers.
"The USAID staff and NGO partners are sometimes denied access to deliver assistance to people in need," Blake said.
"Many NGOs have been the target of unsubstantiated allegations in the Sri Lankan press that have caused the staff of these NGOs to be subject to physical harassment and intimidation."
Sri Lanka's military has accused several foreign organisations of supporting the Tigers, a charge repeatedly denied by them.