By Amit Baruah

NEW DELHI Aug. 27. The Sri Lankan Minister for Economic Reforms, Milinda Moragoda, has said confidence-building measures and developmental issues will be on the agenda for talks with the LTTE next month in Thailand.

Mr. Moragoda, who held discussions with the National Security Adviser, Brajesh Mishra, here today, said Sri Lanka had received a lot of encouragement from India for the peace process.

The talks would take place in the presence of the Norwegian facilitators - the Deputy Foreign Minister, Vidar Helgesen, and Mr. Erik Solheim - who did the initial spadework.

The Norwegians, he said, were working out the framework for the talks and had been present during his two recent meetings with Anton Balasingham, who is expected to head the LTTE delegation for the talks.

The Sri Lankan Constitutional Affairs Minister, Gamini Lakshman Peiris, was expected to lead his side.

A formal announcement of the Sri Lankan delegation would be made by the Prime Minister, Ranil Wickremesinghe.

Asked whether the LTTE was using the cease-fire and dialogue process to strengthen itself, Mr. Moragoda said: "We are taking it (the peace process) at face value.''However, he made it clear that the Sri Lankan Government was not underestimating the challenges that lay ahead in the dialogue process.

When asked if the talks would only be about setting the stage for a formal process, he said this would be the beginning of the formal process of talks.

Mr. Moragoda reiterated that his Government had adopted a step-by-step approach to the peace process and, so far, the cease-fire with the Tigers had held.