In a new blow to peace-making, a defiant Israeli government decided today to pump large sums of money into Jewish settlements, and Palestinian militants vowed to renew attacks in Israel.
In the Gaza Strip town of Khan Yunis, 25,000 supporters of the Muslim militant group Hamas rallied today, chanting "Qassam, Qassam," the name of the Hamas military wing involved in previous suicide bombings.The latest developments came as relations between Israel and the Palestinians are under serious strains.
Talks about an Israeli troop pullout in the West Bank town of Hebron are deadlocked. Palestinians are angry over Israeli plans to build 132 Jewish homes in an Arab neighborhood in Jerusalem. Israel is also demanding that Palestinian police do more to catch gunmen who killed a Jewish settler and her 12-year-old son in a drive-by shooting Wednesday.
The Israeli Cabinet decided today to expand incentives to make all 144 Jewish settlements in the West Bank and Gaza Strip financially attractive for Israelis to move there. Settlers will pay less income tax, and business people will receive grants equal to at least 20 percent of their investments.
Israeli radio said Cabinet ministers argued over where the money should come from, but decide to rule on that issue later.
"This decision is going to cost a great deal of money. I don't know where the government is going to find the money," former finance minister Avraham Shohat told Israel army radio. "It is a bad, destructive and dangerous decision."
Shohat estimated the plan could cost tens, if not hundreds, of millions of dollars, although the government has not given any figure. Only last week, the Cabinet cut $600 million from the 1997 budget to reduce a growing deficit.
Yasser Arafat's spokesman, Nabil Abourdeneh, condemned the Cabinet's decision as a violation of Israeli-Palestinian peace accords.
About 145,000 settlers live in the West Bank and Gaza amid 2 million Palestinians. Each new house built in settlements makes the Palestinians' dream of setting up a state in the West Bank and Gaza more unattainable.
Many settlements already had special status 1990-1992 hard-line government of Yitzhak Shamir, but that was revoked when Yitzhak Rabin came to power in 1992, except for several settlements around Jerusalem.
A leaflet distributed today by Hamas' military wing, Izzedine al Qassam, said the group would carry out new attacks to mark the anniversary of the death of chief bomb maker Yehia Ayash.
Ayash was killed Jan. 5 when his mobile telephone exploded as he answered a call. Israel is widely believed to have orchestrated the assassination.
In February and March, Hamas carried out four suicide bombings to avenge Ayash' death, killing 63 people.
Hamas called today's rally to mark the ninth anniversary of its founding and to commemorate Ayash.
In Israel, security forces were on alert for possible violence by Palestinian militants. Troops set up additional checkpoints on roads leading from the West Bank to Jerusalem.
Streets were closed around the Shalom Tower in Tel Aviv today, Israel radio reported. Intelligence reports have previously sited the office tower and shopping complex as a potential target.