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SHAMIR URGES PEACE TALKS, BUT ARABS SAY WAR LOOMS

Prime Minister Yitzhak Shamir says his new government's message to Arab states is that they should talk peace with Israel.

"I think that the Arab world will have to decide to sit down and negotiate with Israel about the conditions for peace," Shamir said on an interview broadcast on Israel radio Saturday.Arab commentators said however that formation of Shamir's new government - which is the most right-wing in Israel's history and is freed from the restraint of the dovish Labor Party - was pushing the Middle East toward war.

"The Arab-Israeli conflict has quickly taken a path that leads only to war and instability," said the independent Jordanian newspaper al-Dustour.

Salah Khalaf, a top PLO official told Reuters in Tunis: "It is a war Cabinet, the worst in Israel's history, and represents the summit of fanaticism, intransigence and extremism."

Shamir said that "this government represents a large number of parties inside our political community. This government represents the majority."

"We have proposed many times to the Arab world many peace proposals. We propose it again," he said.

Palestinians shut themselves in their homes Saturday, marking 30 months of revolt in the occupied territories amid fears for the future (see story at right).

Palestinian philosopher Sari Nusseibeh says that within a month or two Shamir and Foreign Minister Moshe Arens will lose control of policy to the hawkish majority in the cabinet.

"The dynamic of the new government will crystalize toward the Sharon school of thought," he said referring to former defense minister Ariel Sharon, tapped to become housing minister.

In an interview broadcast on Israel radio Saturday, Shamir said he will seek contacts with the United States "with more vigor."

Relations with Washington have worsened recently while Shamir's interim government continued to reject a U.S. peace initiative and settle Soviet Jews in the occupied territories.

Shamir also faced a new threat when female members of the governing Likud Central Committee said they would disrupt Sunday's meeting, scheduled to confirm Shamir's new Cabinet, Israel radio said.

It said 400 women planned to protest unless at least one female minister was appointed to the Cabinet. Ultra-Orthodox religious parties have opposed serving on a Cabinet with women.