Sharon allows 1,000 more settler homes in West Bank

Prime Minister Ariel Sharon has approved 1,000 more Israeli settler homes in the occupied West Bank to defuse a ruling party mutiny but the move was likely to anger Washington.

US officials suggested the decision, disclosed by Sharon confidants yesterday, contradicted Washington's "road map" peace plan that prescribes a freeze on settlement building on territory where Palestinians have been fighting for statehood.

The package of building tenders had been shelved several weeks ago to avoid possible discord with Israel's main ally.

But Housing Minister Tzipi Livni said yesterday the construction bids would adhere to "understandings" with Washington that new homes could be erected within current settlement boundaries.

Sharon confidants said he was trying to blunt resistance within his right-wing Likud party over his US-endorsed plan to "disengage" from conflict with Palestinians by evacuating all 8,000 Jewish settlers from the Gaza Strip.

Sharon faces a snap Likud convention today at which party nationalists hope to vote down his proposed alliance with the dovish Labour party, a fervent proponent of withdrawals.

"Sharon is manoeuvring to reinforce his flanks and get past Likud opponents of disengagement (from Gaza)," said a senior source close to the former army general.

"Sharon may only need these tenders for the next 24 hours, for the convention. Afterward, who knows, he could freeze them again.

"Anything is possible. It's just internal politics. He is merely doing what he must to proceed to disengagement."

Sharon's aides said he would pursue his Gaza plan with a "unity" coalition however the non-binding Likud vote panned out.

He is confident anti-withdrawal activists in Likud will stop short of thrusting him into early elections over a plan that has commanded solid majorities in opinion polls, analysts said.

Sharon wants Labour by his side to prevent Likud hardliners blocking cabinet and parliamentary votes on phasing in the Gaza withdrawal. But coalition talks have become bogged down over Labour's demand for more social spending in 2005.

But Labour leader Shimon Peres, keen for a unity coalition, said he had no intention of compounding Sharon's difficulties.

"I don't know what will happen at the Likud convention, but if Ariel Sharon continues with disengagement, we won't be the ones to cause the opportunity to be wasted," he told reporters.

Sharon sees Labour as the linchpin for restoring his parliamentary majority lost when far-right coalition partners defected or were sacked in June for bucking his Gaza blueprint.

US leaders have hailed the first prospect of an Israeli pullout from territories captured in the 1967 Middle East war.

But they want Sharon not to expand large West Bank enclaves, where much of the 240,000-strong settler population lives, in hopes of reviving Middle East peace talks.

"Israel has accepted the road map and we expect it to abide by its commitments," said US Embassy spokesman Paul Patin.

But US President George W. Bush assured Sharon in April that if Israel got out of Gaza, it could keep bigger West Bank settlement blocs it regards as strategically vital.

"The problem is that we have never said publicly whether we accept Israel's interpretation of a settlement freeze," said a US diplomat who asked not to be identified.

Diplomats in the US-led Quartet sponsoring the road map said the new housing defied at least the spirit of the plan, but Bush was unlikely to challenge Sharon and risk losing pro-Israel votes during a tough re-election campaign.

"The reality is the Israelis have wiggle room in the existing diplomatic context," said a Quartet diplomat.

Palestinian leaders and Israel's settlement watchdog group Peace Now accused Sharon of riding roughshod over the road map in sanctioning a new flurry of settlement-building.

But Israeli officials have privately written off the road map. The plan envisages a viable Palestinian state in the West Bank and Gaza, but has been shredded by violence on both sides.