Aid workers warned Saturday of a humanitarian catastrophe if the United Nations and Red Cross pull out of Sri Lanka, where agency staff are facing mounting restrictions and threats to their safety amid a worsening civil conflict.

U.N. agencies and the International Committee of the Red Cross are the only relief groups with access to some parts of the north and east, where the government is locked in fierce battles with Tamil Tiger rebels. Hundreds of thousands of mostly ethnic Tamils in those areas are facing food, water and other shortages.

In the last few days, the U.N. and the ICRC have both warned that if security does not improve for staff in the country, they could stop their operations.

CountryWatch: Sri Lanka

The warnings come after independent monitors of Sri Lanka's all-but-defunct 2002 cease-fire said they were convinced that security forces were behind the killings of 17 local staff for an international aid agency, Action Against Hunger, earlier this month. The government has vehemently rejected the allegation.

"If we felt that our staff were not safe, we would not operate," Reto Meister, ICRC delegate-general for Asia-Pacific, told reporters in Geneva on Friday.

His warning followed a similar word of caution by U.N. humanitarian chief Jan Egeland.

"We cannot continue in this area unless we know that people will be held accountable for the execution of 17 of our colleagues," Egeland said in New York.

Aid workers warned that such a situation would be a catastrophe for the nearly 220,000 people who have been displaced by the last five months of near-daily shelling, air strikes and artillery battles in the north and east, where the Tigers are fighting to establish a separate Tamil homeland.

Sri Lanka's navy said Saturday it sank 12 Tamil Tiger boats, including five suicide craft, and killed as many as 100 rebel fighters during a fierce six-hour sea battle off the country's northern coast.

The fighting broke out late Friday when about 20 boats belonging to the Tigers' fierce sea wing attacked a navy patrol near Kankasanthurai harbor, to the east of the northern Jaffna peninsula, navy spokesman Commander D.K.P. Dassanayake said.

"At a time when more people are increasingly in need, and aid agencies need more humanitarian space to work, the government is trying to limit our space. If the U.N. agencies pull out, it would be a catastrophe," said one aid worker who requested anonymity, fearing that speaking publicly on the matter would jeopardize his agency's work in the country.

As fighting between separatist rebels and the government has escalated, aid workers have been hit with a slew of new travel and work restrictions, mostly in conflict zones where there are sizable ethnic Tamil populations.

Some aid workers and human rights groups have suggested the government and rebels do not want "external witnesses" in these areas, but the government says the restrictions are to protect the safety of aid agency staff.

Over the last few weeks, aid workers have been "stopped, blocked and intimidated" by security forces in eastern Trincomalee, Batticaloa and Ampara districts demanding to see nonexistent Ministry of Defense registrations, said another foreign aid worker, also requesting anonymity.

While the Ministry of Defense in Colombo has assured aid agencies that they do not need the registration, the message has failed to filter down to security forces on the ground, said Jeevan Thiagarajah, executive director of the Consortium of Humanitarian Agencies, an umbrella group for local and international aid agencies in Sri Lanka.

"The government and the (rebels) need to be up front and say that they will not impede or harm humanitarian workers or their work," Thiagarajah said.

"Right now, we are getting mixed messages. The government is saying that it doing its best to help us, but on the ground it is a different story," he said.

Hundreds of aid workers also are still waiting for newly introduced work permits, despite submitting applications months before the Aug. 31 deadline.