Informal ceasefire again agreed between Karen National Union (KNU), Myanmar’s largest rebel group, and Yangon. KNU senior figure insisted further talks needed. Karen National Progressive Party claimed 14 January that Myanmar troops had forced 2,000 ethnic Karennis from their homes. Government released 26 National League for Democracy members.

Conflict with Maoist rebels continued unabated. Mayor of southern city of Birgunj killed 15 January; bus explosion killed 3 on 16 January; government soldiers killed 7 Maoist rebels in Dolokha district 21 January. Students claimed anti- monarchy protests in Kathmandu and Pokhara resulted in 120 arrests. Pro-democracy protesters in Kathmandu 30 January called for King Gyanendra to fire loyalist PM. Maoists indicated could accept constitutional monarchy if king gave up control of army.

Parliament’s vote of confidence extended President Musharraf’s presidency until end of 2007. Vote followed deal with Islamist coalition (MMA) in exchange for promise to retire as chief of army staff by end of 2004. Musharraf addressed parliament for first time since coup 4 years ago, promised to clamp down on extremism; heckled by opposition lawmakers during speech. Two planes containing some opposition members diverted, preventing members’ attendance at address. Karachi car bomb outside Anglican cathedral 15 January wounded 11. Western intelligence sources said Pakistani scientists traded uranium enrichment technology with North Korea, Libya and Iran. Government admitted nuclear scientists may have been involved in proliferation deals. Officially 9 nuclear scientists detained, causing domestic upheaval as supporters condemned arrests of ‘national heroes’. Dr Qadeer Khan, ‘father of the bomb’, sacked as government scientific advisor 31 January.

Legality of 5-month adjournment of parliament questioned by ombudsman. Government adjourned parliament to escape vote of no confidence after failing to amend constitution. Deployment of 300 Australian police and civil servants to address growing lawlessness as condition of Australian aid program to take place within weeks.

President Arroyo announced progress in peace talks with rebel groups. Exploratory talks announced for February between government and secessionist Moro Islamic Liberation Front (MILF). Bomb in Mindanao linked to local political rivalries killed 10. Formal talks between government and communist New People's Army (NPA) also to resume in February. NPA attacked power plant 10 January killing 3. President Arroyo met Malaysian PM Badawi in Manila for talks on southern peace process. Malaysia to send truce monitors. Military officers under investigation following accusations that defence secretary ordered soldiers to spy on opposition candidates for presidential elections.

Feud between President Kumaratunga and PM Wickremesinghe continued with both sides intransigent over control of defence ministry. Sri Lankan government demanded 9 January Kumaratunga renegotiate ceasefire with Tamils or give up security portfolio appropriated in November. Kumaratunga claimed she could keep office 1 year longer than expected, until 2006, due to early investiture and second secret inauguration ceremony: claim rejected by government. Snap elections possible as Kumaratunga’s Sri Lanka Freedom Party (in opposition) signed alliance with Marxist People’s Liberation Front (JVP), Sri Lanka’s third largest party, creating The United People’s Freedom Alliance. JVP opposed to devolution of power to minority Tamils. Tamil Tigers (LTTE) continued to warn that peace process under threat. Norway replaced leader of monitoring mission whom Kumaratunga had accused of anti-government bias. Delegation from LTTE travelled to Norway for talks 28 January.

Under U.S. pressure, President Chen Shui- ban modified language of proposed 20 March referendum: voters now to be asked whether they approve increasing purchases of U.S. weapons should China fail to redeploy missiles aimed at Taiwan; earlier version involved direct call for removal of missiles. China condemned revised language, saying referendum would bring tensions to “brink of danger”. French President Jacques Chirac called poll “grave mistake”, angering Taipei.

Wave of violence in south blamed on separatist Islamist militants. Weapons depot looting and arson attacks on 21 government schools 4 January, followed by 10 deaths in several incidents. In response, martial law declared in Pattani, Narathiwat and Yala provinces in predominantly Muslim south. Arrest warrants for 4 Muslim militants issued. Security clampdown fuelling resentment. Thai PM Thaksin Shinawatra blamed lethal machete attacks on 3 Buddhist monks as work of separatists attempting to ignite religious conflict.

Government called for UN to extend its mission beyond 20 May deadline. At present 2000 UN personnel in East Timor. UN Secretary General to report to Security Council in February. Australian Defence Force chief, General Peter Cosgrove, said his troops should remain in East Timor even if UN pulls out in May. Two issues raising tensions on border with Indonesia: East Timorese upset by Indonesian military exercises on Palau Batek, small island off coast of East Timorese enclave. Secondly, group composed of disgruntled former Fretilin members, Kolimau, allegedly infiltrating from East Timor into West Timor to recruit former militias there to help destabilise East Timor once UN peacekeepers withdraw May 2004.

Turkey offered to hold trilateral talks with Armenia and Azerbaijan over disputed Azerbaijani territory, occupied by Armenian forces since 1993.