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NEW DELHI | Thu Mar 10, 2011 8:26pm IST

NEW DELHI (Reuters) - India denied on Thursday the presence of Tamil Tiger camps in its south, a day after Sri Lanka said the separatist rebels were training members in Tamil Nadu to carry out assassinations.

Sri Lankan Prime Minister D.M. Jayarathne told parliament on Wednesday intelligence reports showed that remnants of the Liberation Tigers of Tamil Eelam (LTTE) had established three training camps in Tamil Nadu.

The allegations of Indian involvement struck an unpleasant chord in Sri Lanka, because India in the 1970s and 1980s trained the LTTE and other Tamil separatist groups in Tamil Nadu as part of a strategy to counter U.S. influence in its tiny neighbour.

"There are no camps of the LTTE in India as far as we are aware. The LTTE is still a banned organisation and wherever we find their cadres we will arrest them," India's Home Secretary Gopal Pillai told Reuters.

"If they have any information, the Sri Lankan government can pass it on to us and we will follow it up."

The Sri Lankan government crushed the LTTE in May 2009 after a quarter-century war during which the Tigers fought to create a separate state for the Tamil minority, who represent about 15 percent of the island nation's 21 million people.

Tamil Nadu is 40 km (25 miles) across the Palk Strait from Sri Lanka and is home to roughly 65 million Tamils. Many supported the LTTE, and state politicians have used the ethnic bloc to influence New Delhi's policy toward Sri Lanka for decades.

Sri Lanka's Jayarathne told parliament on Wednesday that information showed at least one of the secret camps was set up to train fighters in VIP assassinations, an LTTE specialty. During the war, they killed two Sri Lankan heads of state and former Indian prime minister Rajiv Gandhi.

"Intelligence has gathered information that in the hope of assassinating Indian state leaders and re-establishing themselves in Sri Lanka, the Tigers are training in three secret locations in Tamil Nadu," Jayarathne said.

Sri Lanka's $50 billion economy has been on a revival course since the end of the war in 2009, but the country still remains under some wartime emergency laws that give the government powers of arrest and detention without cause.

Although Western governments have pressed the government to relax them further, President Mahinda Rajapaksa has used his large parliamentary majority to keep them in place, arguing that to relax them would mean some LTTE operatives would go free.

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