In the latest carnage, more than 100 people -- most of them sailors -- were killed when Tiger suicide bombers detonated a truck packed with explosives next to a convoy of naval buses near the restive district of Trincomalee.
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The government, which last week also suffered a major battlefield defeat in the northern peninsula of Jaffna with the loss of at least 133 soldiers, has hit back with air strikes.
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"Both sides are stubborn," said Harry Goonetileke, a retired air force chief and a political advisor to a former president.
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"It seems the Tigers want to provoke air attacks. That will be their excuse for not going for talks.
The government is playing into their hands," he said, adding that the recent debacles should encourage the government to adopt a more conciliatory attitude.
Former Tamil rebel turned politician, Dharmalingam Sithadthan, argued that neither side was keen on talks partly because they had no political basis to negotiate.
"Even if they go for talks, what they want is to