Israel to release 400 from prison to boost Abbas

In a separate development, a senior Israeli official disclosed that the Israeli army might occupy parts of the Gaza Strip's second largest city, Khan Yunis, in order to secure the withdrawal of Jewish settlers from the nearby Katif bloc in mid-August.

"A few days before the real evacuation, a political- military decision will be made on this," the National Security Council director, Major- General Giora Eiland, said.

"The best scenario is full and reliable co-operation with the Palestinians. But the military must be prepared for a less optimistic scenario. There are preparations for military operations in and around Khan Yunis and in other cities," he said.

Previous raids into Gaza urban areas have resulted in heavy civilian casualties.

The prisoner release, for which no date was given, will come as a belated fulfilment of a pledge made by the prime minister, Ariel Sharon, at the Sharm el-Sheikh summit in February to release a total of 900 Palestinian prisoners. Five-hundred Palestinians were released shortly after the summit, but Israel froze further releases after a 25 February suicide bombing in Tel Aviv and suspended a joint committee appointed to determine criteria for the releases.

At the weekly cabinet meeting yesterday, Mr Sharon alluded to the growing strength of Hamas, which scored well in the recent municipal elections, as a reason to proceed with releases. "Israel has complaints against the Palestinian Authority, even severe ones about their not implementing the Sharm understandings, but especially those people who are convinced the events of the coming months are liable to strengthen the extreme terror organisations certainly understand the need to strengthen the moderate element in the Palestinian Authority and fulfil what we have promised," he said.

The Palestinian Authority negotiator, Saeb Erekat, criticised the planned release as "insufficient" and for not having Palestinian input.