Sri Lankan Prime Minster Ranil Wickremesinghe has offered to hand over crucial negotiations with the Liberation Tigers of Tamil Eelam to President Chandrika Kumaratunga, telling foreign diplomats that he can no longer lead the peace process.

The truce with the LTTE had seen the end of battlefield hostilities and suicide bombings by the rebels, a slow improvement in the economy and a hike in foreign investment.

Last week, Kumaratunga abruptly snatched the portfolios of defence, internal security and the state-owned media from the government, led by her arch rival Wickremesinghe, creating an unprecedented political crisis.

She also suspended parliament till November 19, but on Friday said it would re-convene on that day to allow the government to present its annual budget.

There is concern that Kumaratunga's actions had jeopardised the truce but the Tigers have not yet indicated anything to that effect though they say there is an attempt to scuttle the peace bid.

"The government's view is that because the prime minister does not have control over all aspects of the peace process, he can't handle it any further," the government's chief negotiator G L Peiris told reporters in Colombo.

He said the prime minister met with envoys of the United States, Japan, Norway and the European Union - the co-chairs of the international drive to raise financial aid for the peace bid - to express his concern. Wickremesinghe asked them to 'explore the possibility of the president taking over the process'.

The president's own efforts to conclude peace with the LTTE, with the Norwegians acting as brokers, broke down in 2001 and she has consistently criticised Wickremesinghe for dealings with the LTTE.

Wickremesinghe called his efforts "the last chance for peace" that the country has to end a bloody war that has taken over 60,000 lives. His government is demanding the return of the three key portfolios that Kumaratunga is now handling.

The prime minister on Friday rushed back from the US where he had been when Kumaratunga decided to strike and said his priority was to keep the fragile peace bid on track.

He said he was assured by US President George W Bush and other foreign leaders that they would support him in his efforts to keep the Norway-backed peace bid from failing.

Kumaratunga on Tuesday said she took over the ministries because the ministers had compromised national security but pledged to abide by the Oslo-arranged truce concluded between the government and the LTTE last February.

She said in a televised address on Friday that the ceasefire was illegal because it had not been signed by her but by the prime minister.

"If the ceasefire agreement is illegal, then how can the prime minister accept responsibility for the ceasefire?" Peiris asked on Sunday.