Twenty six years ago, I was writing the earliest of the stories that would end up in my first book, in which a man called CK dreams about opening a guest house on the east coast of Sri Lanka. If one tries to pin his dream down on a map, I guess it would be just a few miles from the so-called "no-fire zone" today, a place where Tigers are said to be shooting Tamil hostages who do not want to be human shields, and the government of Sri Lanka is accused of bombing civilians; the strip of land where the BBC says the endgame of this long civil war is being played out, and from where 160,000 men, women and children have fled in the last couple of weeks. The heart-wrenching images of those refugees are superimposed for me on CK's dream and an idyllic sepia photograph, in a family album, of the small town of Mullaitivu, where an uncle and aunt lived 60 years ago.

Between my first draft of CK's story in the spring of 1983 and the second in the summer of that year, Sri Lanka went into freefall. Tension had been building up for some years in Sri Lankan politics. Many Tamils felt heavily discriminated against in the increasingly Sinhala-focused agenda of successive nationalist governments in Sri Lanka, whereas many in the majority Sinhala population saw the government's changes as redressing imbalances instituted under British rule. These tensions burst into sporadic militant attacks in the north through the 1970s and an increasing government military presence in the area.

Then, in 1981, in an act of incomprehensible malice, the revered Jaffna public library was set alight by a policeman.

Although there had been a precursor in the serious communal riots of 1958 (in part flowing out of the controversy over the national language issue), 1983 was a horrific watershed. In July that year, the ambush of 13 soldiers in the north sparked anti-Tamil riots all around the country, especially in the capital, Colombo. Hundreds, some estimate 2,000, ordinary Tamils were killed, and many tens of thousands were made homeless.

The fledgling militant group the Liberation Tigers of Tamil Eelam (LTTE), formed in 1976 and commonly known as the Tamil Tigers, gained massive support at home and abroad and grew quickly to become a formidable guerrilla force. Very soon it was engaging in conventional warfare with the Sri Lankan army to establish an independent homeland.

Over the next few years, the fighting in the north of the island and the invective between partisans around the world intensified. My small story finally found its shape and a publisher. The editors of Stand magazine wrote to me and said: "We want to print it, but the office is divided on the coda. The final paragraph on the violence politicises the text. Half of us want it in, half of us want it out because maybe the story does not need it." I said it could not be left out; the war had invaded even that little page.

By the time the story became the core of a book, Monkfish Moon, in 1992, the earlier lines had expanded: "... the east coast, like the north, would become a blazing battleground. Mined and strafed and bombed and pulverised, CK's beach, the dry-zone scrub land - disputed mother earth - would be dug up, exploded and exhumed. The carnage in Colombo, massacres in Vavuniya, the battle of Elephant Pass, were all to come. But that day ... in the middle of May, we knew none of that."

Today, we do know all of that, and more. We know that in the 26 years since 1983 at least 70,000 people have been killed in the conflict. Another 6,500 have died in the last three months, as reported by the UN. Large numbers of both government soldiers and Tigers who had not even been born at the time the story was written are dead. Their lives, as well as the foreshortened lives of thousands of ordinary people, had never known anything but the war. Tanks have rolled, fighter jets have roared, and suicide belts and trucks have exploded.

Sri Lankans of every kind, overwhelmingly the poorest, have been bombed by one side or the other for decades. Many MPs and ministers, too - Sinhala and Tamil, hawks and moderates - have been murdered in this conflict.

For 26 years the main story in Sri Lanka has changed little: bombs, bullets, carnage and suffering. LTTE suicide bombs on buses, at train stations, suicide trucks at the Temple of the Tooth, the Central Bank, the assassination of one president, the wounding of another, and government military campaigns with increasing firepower and increasing casualties, terrifying air strikes and massive bombardment. Sadly, there have been other spikes of horror in the country with tens of thousands of dead - the 2004 tsunami, floods, the 80s insurrection in the south, disappearances, abductions - but the war has gone on relentlessly, in one area of the north or another, with only short periods of truce in which the Tigers and the government each gathered strength for the next round.

In those 26 years the great map of the 20th century was transformed: the Berlin wall came crashing down, Germany was reunified, the Soviet Union disappeared, China became the factory of the world and India boomed. But in Sri Lanka, the story remained the same.

A country that was once an admirable model of democracy, leading the way in agrarian reform, quality of life indices, and health and education services, got stuck as the prototype for suicide bombers on the one hand, and the new benchmark for "shock and awe" tactics with unbridled military muscle on the other. I find it difficult to believe that it was allowed to happen.

Sri Lanka is an island that everyone loves at some level inside themselves. A very special island that travellers, from Sinbad to Marco Polo, dreamed about. A place where the contours of the land itself forms a kind of sinewy poetry. Even those who plant landmines, blow up innocents, destroy villages or ravage the jungle, still love the place. They love the sight of it, the sound of it, the smell of it, the taste of it, the memory of it, the dream of it. Whether they carry coconuts or grenades, poems or bombs, cyanide or charms, there is a deep affection for the place which is an unbreakable common bond. Every Sri Lankan, and almost every visitor to Sri Lanka, carries a longing for the place in some small form - hiraeth, the Welsh call it - wherever they go and whatever their background. It binds them however much the war and politics might try to divide them. In recent years, despite the escalating violence, I found it bubbling up in so many places in Sri Lanka: in ethnically mixed children's peace camps, in young writers' imaginations, Sinhala and Tamil, in cricket crowds that brought everyone together. Only a few months ago, an armed soldier I spoke to on the street put it very simply: "There is no country like Sri Lanka anywhere in the world, is there? That is why everyone wants to come here, no?"

Today, watching video clips on the web of the grim situation on the east coast, the demonstrations around the world, the half-reports, the exhortations, the accusations, the propaganda, the excuses, I don't know what to make of the future. Is there anyone now who "can look into the seeds of time, and say which grain will grow and which will not"?

Under a pile of newspapers, I find a copy of the old tragedy from which I filched that quote. I open it and find Macbeth in the second act, speaking after he had killed the men he wished to pin Duncan's murder on. His cunning excuse sounds familiar: "Who can be wise, amazed, temp'rate and furious,/loyal and neutral, in a moment? No man./The expedition of my violent love/ outrun the pauser, reason." It doesn't tell us much about how to live, but we can certainly see how not to live. Disturbing, traumatic events do not reduce the relevance of poetry and fiction. For me, they make imaginative writing all the more urgent and necessary.

I have been back to Sri Lanka twice in the last six months, trying hard to find something of the optimism I felt writing my last book, The Match. I started writing it when peace had unexpectedly broken out in 2002. The novel was going to be like a bookend to the story I mentioned at the beginning of this piece, to celebrate a new beginning. But soon after it was published in 2006, the peace talks floundered. A few months later, the war entered a new and more fearful phase.

Wherever I went on these last two visits, no one - Sinhala or Tamil - wanted to talk about the war. They were fed up with the war. It had gone on too long, cost too many lives, hurt too many families. They all wanted it over one way or another. Taxi drivers, waiters, businessmen, writers, journalists, cobblers, farmers, and even soldiers. No one wanted to talk because no one believed it was nearing an end. No one believed anything about the war in the news. Too many journalists had been intimidated.

A famous editor had just been killed by yet unidentified gunmen. The concern I heard was about corruption and censorship.

Even when government forces finally took Kilinochchi, the LTTE administrative headquarters for years, my trishaw driver did not believe it. Now, it seems, there is a growing belief that the war, at least the one of tanks and planes and artillery bombing, will soon be over. The government is determined to completely destroy the military capability of the LTTE under its present leadership, and is unlikely to deviate from that mission. It has made single-mindedness one of its core characteristics and an electoral attraction. The paradigm has shifted.

What comes next? Some fear a dangerous mix of triumphalism and chauvinism; entrenchment of resentments; internment, radicalisation and insurgency. Others see an opportunity for reconciliation, reconstruction, and a slow, painstaking path towards real respect. The compassionate and exemplary treatment of the hundreds of thousands of displaced people would be the first step.

The other night, in London's Nehru Centre, I heard the Bengali poet Sunil Gangopadhyay recite a powerful poem against the warped beliefs we use to excuse our sometimes atrocious behaviour. It made me think: what should I believe in now? What can I believe in? What must I believe in?

So, here is a list to start with:

- I must believe that the fighting will be over tomorrow and there will be no more killing, indiscriminate or discriminate.

- I must believe that those who have the power will ensure that future generations will not be brought to this point of suffering again.

- I must believe that everyone believes murder is wrong.

- I must believe that aid will flow into the country and that it will go wholly and directly to those who have suffered most.

- I must believe that money for war will be converted into money for peace and reconstruction, wherever it may come from.

- I must believe that a military victory will not lead to triumphant jingoism.

- I must believe that all those who have been trained only to fight will be found gainful civilian employment.

- I must believe that the ambitions of the military will not grow ever larger.

- I must believe that a just and democratic society nurtures and protects all its people and treats them equally.

- I must believe that dissent will not be punished.

- I must believe that the press and media will be free and fair and brave.

- I must believe that journalists will not be intimidated.

- I must believe that good will is stronger than ill will.

- I must believe that good leaders are honourable people who will always place the interests of their people before the interests of themselves.

- I must believe that the young will learn from the mistakes of the elders.

- I must believe that we will not be fooled again, wherever we are and whoever we are.

- I must believe in the human capacity for compassion and reconciliation.

- I must believe all wrongs will be righted.

- I must believe that in words we will find what in fury we cannot.

But must I also believe - as leaders on all sides seem to - that the end justifies the means? Does it, really?