Israel to ease blockade

Security sources said Defense Minister Shaul Mofaz had also decided in principle to remove 10 to 20 Jewish settlement outposts on occupied West Bank land. He is to hold talks in Washington with US officials who want the outposts uprooted.

Israel's army chief jarred the government last week when he said the clampdown was driving Palestinians into the arms of militants, undermining leaders like Qurei who want peace talks.

"The point of these steps is both to help Qurei consolidate his position vis-a-vis Arafat and the militants and satisfy the Americans, who have been very critical of outposts," a senior Israeli security source said.

No timetable was given, and Palestinians reported no easing of restrictions that have largely trapped them in their towns and crippled their economy.

An army statement said armored forces would reduce their presence in and around West Bank cities except for Nablus and Jenin, bastions of Islamic militants. But there was no intention of removing a network of checkpoints and roadblocks.

It said troops would continue raiding Palestinian areas if needed. Israel says its measures are a must to stop suicide bombers. Palestinians say incursions obstruct cease-fire efforts.

Palestinian political upheaval has impeded diplomacy to carry out a US-sponsored "road map" to end violence and create a Palestinian state by 2005.

Qurei's struggle to gain Cabinet powers over security services dominated by Arafat has delayed the formation of a government for over a month.

Arafat converted Qurei's eight-member "emergency" Cabinet into a caretaker government Tuesday, hours before its 30-day term expired, allowing more time to resolve the dispute.

Ministers said they were seeking a solution, but a meeting between Qurei and Arafat during a session of the ruling Fatah faction ended with the prime minister walking out without a word to reporters and looking troubled.

Later, without Qurei, Arafat met Fatah leaders to try to resolve the impasse, but those talks, which lasted for about five hours, ended without progress. They were to continue today. Arafat opposes Qurei's choice of General Nasser Youssef as interior minister with control over security forces. He fears losing control over security would relegate him to a figurehead.