The 2002 cease-fire between the Sri Lankan government and the Liberation Tigers of Tamil Eelam (LTTE), a designated Foreign Terrorist Organization, continued to erode amidst numerous violations and escalating military engagement between the LTTE and government security forces. The Sri Lankan Army remained deployed across the country to fight the insurgency. The paramilitary Special Task Force (STF) police were deployed both in the east and in strategic locations in the west.
The LTTE conducted a campaign of targeted assassinations against political and military opponents. This included the April assassination attempt of Sri Lanka Army Commander General Sarath Fonseka and the assassination of the Army Third-in-Command; the August 12 assassination of the Government of Sri Lanka's Secretariat for the Coordination of the Peace Process, Deputy Director Keteshwaran Loganathan; and the December 1 suicide bomber's attempt on the life of Defense Secretary Gothabaya Rajapaksa, the President's brother. The Karuna faction, a dissident faction of the LTTE, conducted its own assassination campaign against the LTTE and pro-LTTE civilians in the east.
Following the assassination of Foreign Minister Kadirgamar in August 2005, the government enacted emergency regulations giving arrest power to members of the armed forces, who were required to turn suspects over to the police within 24 hours. Individuals arrested under the emergency regulations may be detained for up to one year. Under these regulations, 148 persons were arrested; most have already been released. A revised Prevention of Terrorism Act (PTA), enacted in December, strengthened these powers.
The LTTE financed itself with contributions from the Tamil Diaspora in North America, Europe, and Australia, and by imposing local "taxes" on businesses operating in the areas of Sri Lanka under its control. Using this money, LTTE weapons were purchased on the international black market or captured from the Sri Lankan Army. Many LTTE innovations, such as explosive belts, vests, and bras, using female suicide bombers, and waterborne suicide attacks against ships, have been copied by other terrorist groups.
In general, the LTTE did not target U.S. citizens or assets, limiting attacks to Sri Lankan security forces, political figures, civilians, and businesses. However, two suicide bomb attacks on VIP motorcades in Colombo occurred within half a mile of the U.S. embassy on roads frequently traveled by Embassy employees.
Sri Lankan cooperation with the FBI has resulted in arrests of persons charged with material support to terrorist groups. The Sri Lankan government cooperated with U.S. efforts to track terrorist financing, although no assets were identified. The United States also provided training for relevant Sri Lankan government agencies and the banking sector. The government cooperated with the United States to implement both the Container Security Initiative and the Megaports program at the port of Colombo.