For the thousands of civilians, many of them Muslim, caught up in the renewed violence around the town of Muttur in Sri Lanka, it will be little consolation to be told that their country has not yet descended again into civil war. Yet that is the case.

Both the government and the rebel Tamil Tigers claim to be acting defensively within the provisions of the cease-fire agreed in 2002. Though both sides have warned that the fighting could spiral out of control, the fact is that although it has spread slightly, it has not become general. Each side accepts that is still a dispute over fresh water from a canal.

Herein lie grounds for hope that Norwegian peace negotiators may yet be able to broker an end to the fighting and allow a return to the uneasy peace that existed for the last four years. There are clearly hard-line elements within the Tamil Tiger leadership who want a return to civil war.

They are matched by some top brass within the Sri Lankan military who reject a peace that would give the Tamils any degree of autonomy and still insist on believing the chimera of frustrated generals everywhere — that their opponents can be defeated with just one final push. Twenty years of civil war have proved conclusively that peace will only come through negotiation.

Thanks to the tireless efforts of the Norwegians, Sri Lanka has come tantalizingly close to a lasting settlement. Despite the widespread despair at the Tamil Tigers sabotaging of the most recent round of peace talks, the search for a deal continues.

It may well be significant that the rebels have not used the water dispute as reason for a return to out-and-out hostilities. They closed a sluice gate, thus robbing local farmers of essential irrigation because they said that their wider grievances were not being met.

Given that it was the rebels who broke off negotiations simply because they insisted talks be held in Oslo and nowhere else, shutting off the water was clearly a provocative act.

The attempt by the Sri Lankan Army to assert the rule of law and have the water flow restored to the irrigation canal has proven bloody and inept. Soldiers have been sent forward through mine fields against carefully prepared positions and casualties have been high. However despite the uncompromising response of the authorities, the rebels have not yet sought to widen the conflict.

This may indicate a dispute within the Tamil Tiger leadership. Those who perhaps hoped that the water issue would rekindle the civil war might have had their wings clipped by others who, even if they too were uninterested in negotiations, preferred to maintain the status quo in which they and their cronies have undisputed control over the Tamil population.

As long as the focus remains on the closed sluice gate, the Norwegian peace negotiators have a clear issue on which to negotiate. Thus even though a final settlement is still a long way off, all has not been lost.