Tiger air raid a blow to Sri Lanka’s balance sheet

March 26, 2007 (AFP) – The first ever air attack by Tamil Tiger rebels is a psychological setback to Sri Lanka’s military but could cause an even bigger blow to the island’s economy, analysts said Monday. In the daring strike, the Liberation Tigers of Tamil Eelam (LTTE) used two light fixed-wing aircraft against the Katunayake airbase, the home of Sri Lanka’s supersonic jet fleet — and managed to get away without a scratch.

Alastair Corera, the director of Orion Fund Management, said the operation had revived fears of more rebel strikes outside the embattled northern and eastern regions.
“When there are no events (outside the northeast) people seem to underestimate the risks that prevail, and incidents like this remind us of the risks,” Corera said.

The attack, which killed at least three Sri Lankan air force men and wounded another 16, was a sequel to a suicide bombing of the same air base and the adjoining Bandaranaike international airport in July 2001.

After the 2001 attack insurance firms slapped war-risk surcharges on airlines flying in to the international airport and shipping lines calling at colombo — traffic declined and the economy went into recession.

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