Israel Widens West Bank
Assault - Egypt Cuts Ties

By Christine Hauser

BETHLEHEM, West Bank (Reuters) - The Israeli army invaded two more West Bank towns on Wednesday and Egypt cut direct government contacts with Israel in a sign of rising Arab anger with the six-day-old offensive.
Israel's main ally, the United States, signaled a policy shift by suggesting it was open to addressing political aspects of a Middle East peace deal before a truce exists on the ground -- a move that appeared designed to appeal to the Palestinians.
For a second day, Lebanese Hizbollah guerrillas fired missiles at army posts on Israel's northern border, provoking a response by Israeli artillery and warplanes firing rockets.
The rising tension on the Israel-Lebanon frontier has sparked concern that Hizbollah is trying to open a second front with Israel, whose army is already busy with the Palestinian uprising further south.
On the northern West Bank, tanks rolled into Salfit and Jenin, where they encountered resistance, and Israeli forces kept Palestinian President Yasser Arafat under siege in his headquarters in the city of Ramallah.
Sporadic battles erupted in Bethlehem, where a Palestinian policeman and a member of an armed wing of Arafat's Fatah movement bled to death after being wounded in a clash with Israeli troops on Tuesday, Palestinian security sources said.
Israel has reoccupied a string of West Bank towns and villages since Prime Minister Ariel Sharon sent tanks to Ramallah on Friday, two days after a suicide bombing in Netanya killed 25 Israelis at the start of the Jewish Passover holiday.
Israel's campaign, which it says is intended to end suicide attacks and isolate Arafat, has deepened fears of all-out war and stoked anger across the Arab world. Palestinians say the aim is to topple Arafat and reoccupy Palestinian-ruled areas.
Egypt's cabinet decided to sever direct contacts with Israel's government but left vital diplomatic channels open.
"Government-to-government contacts are stopped. Diplomatic channels remain serve the Palestinian question and the issue of peace in the region," a senior Egyptian official said.
Egypt and Jordan are the only two Arab states to have signed peace treaties with Israel and both have maintained diplomatic ties with the Jewish state. Egypt withdrew its ambassador from Tel Aviv in November 2000 in protest at Israel's handling of the Palestinian uprising. Israel has kept its ambassador in Cairo.
In response to Cairo's move, an Israeli Foreign Ministry spokeswoman said: "At such a sensitive and problematic time, it would be better to strengthen ties, not reduce them."
The White House, in a subtle policy change, indicated that President Bush was open to discussing political dimensions of a peace deal before a cease-fire prevailed.
"There are two vital guidelines that the president is seeking to advance and they can work independently, they can work together," White House spokesman Ari Fleischer told reporters, referring to the security and political issues.
The Bush administration has previously emphasized that the first step was for both sides to implement a security cooperation plan worked out by CIA Director George Tenet.
It has generally argued that a plan evolved by former U.S. Senator George Mitchell, which also deals with the broader political aspects of peace between the Israelis and Palestinians, would follow an accord on security.
Israel had argued that a cease-fire, also sought by the U.N. Security Council, should precede any pullout from Palestinian cities, including Ramallah.
The U.N. Security Council was due to meet for the fourth time in six days. Palestinian diplomats, pushing for a fresh resolution, are demanding that the council enforce its weekend call for Israel to withdraw from Palestinian-ruled areas.
DEATH TOLL MOUNTS IN BETHLEHEM In Bethlehem, the first ambulance allowed to collect Palestinian casualties took the bodies of three civilians and two wounded men from a district near Manger Square to the nearby Beit Jala hospital.
"We expect there are at least 10 more (bodies) from that area," hospital director Peter Qumri told Reuters.
Israeli paratroopers moved street by street, fingers on triggers, peering down alleys. Water gushed from pipes supplying houses, apparently shot up in fighting. Cars crushed by tanks or burned by shelling littered the streets.
About 200 Palestinians, many of them armed, remained in the Church of the Nativity, built over the spot where Christians believe Jesus was born, after taking refuge there on Tuesday.
"(The situation) is complicated because it's a sacred place and we don't want to use live fire (against it)," army spokesman Ron Kitrey told a news briefing in Jerusalem.
"There are several channels of negotiation (going on) to try to achieve as close to a peaceful solution as possible."
Loud explosions and gunbattles shook Jenin as dozens of tanks advanced from three sides and helicopter gunships fired on a refugee camp outside the northern West Bank town.
Israel says the camp harbors militants involved in the wave of suicide bombings that prompted the Israeli campaign.
Three Palestinian gunmen, a civilian man and woman and a 13-year-old boy were killed in the Jenin area, according to Palestinian security sources. Four Israeli soldiers were wounded, Kitrey told reporters.
Palestinians obtained self-rule in major West Bank and Gaza Strip towns under interim peace deals in the 1990s but rose up against Israeli occupation elsewhere 18 months ago after talks on a final settlement became deadlocked.
At least 1,153 Palestinians and 403 Israelis have been killed since the Palestinian revolt began in September 2000.
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