Israel moves against Palestinian Authority

Arafat's HQ in Gaza was targeted by Israeli helicopters

Israeli Prime Minister Ariel Sharon has won his cabinet's backing to declare the Palestinian Authority an "entity that supports terror".

BBC correspondents say the ruling opens the way for further military reprisals against Palestinian leader Yasser Arafat, whom Israel blames for not stopping Palestinian suicide attacks that killed at least 25 people over the weekend.

But the declaration has caused a rift in Mr Sharon's unity cabinet - Foreign Minister Shimon Peres accused the government of attempting to bring about the downfall of the Palestinian Authority, and said his Labour Party would consider seriously whether to stay in the coalition.

On Tuesday morning, Israeli helicopters fired missiles near Yasser Arafat's headquarters in the West Bank town of Ramallah.

There are reports that the building was hit, but it is not known whether Mr Arafat was there at the time.

The strike against Ramallah came after Israeli troops and bulldozers moved into Gaza airport on Monday night and began ripping up its runway as part of a wave of retaliation. Israeli forces have now withdrawn from the airport.

Israeli soldiers were also reported to have entered several Palestinian-ruled areas in the West Bank, including the town of Ramallah, where they were poised just 200 metres from Mr Arafat's compound there.

Arafat is the biggest obstacle to peace and to stability in the Middle East

Ariel Sharon

And in the West Bank town of Nablus, a member of Fatah was reportedly shot dead by Israeli gunfire.

The latest developments follow Monday's assault by Israeli helicopter gunships on Mr Arafat's symbols of power, including two of his helicopters in Gaza City.

Israeli F-16 warplanes were also in action on Monday, attacking buildings in the West Bank town of Jenin.

Palestinian Information Minister Yasser Abed Rabbo denied the charges of terrorism, saying that Israel's occupation of the West Bank and Gaza Strip was "the source of terrorism", and that Israel's actions were making the prospects of peace more remote.

Palestinian leader Yasser Arafat has called for an emergency summit of Muslim leaders, as Arab states accused Mr Sharon of trying to kill off any hope of reviving a peace process in the Middle East.

Tough measures

The Israeli cabinet met after Mr Sharon gave a televised address in which he held Mr Arafat responsible for "everything happening here".

Sharon said Israel would use all available means to defend itself

"He has made the strategic decision to follow terrorism. He has tried to make political gains through the death of innocents," he said.

Mr Sharon said Israel would "chase those responsible for terrorism... those who carry it out will pay the price".

He said Israel would launch a war on terror similar to the one begun by the US after it was attacked in September.

"Just as the United States acts in its battle against world terror, so shall we do with all the means at our disposal," he said.

The Tanzim militia, which is associated with Mr Arafat's Fatah party, and the elite Force-17, which handles his personal security, were among those declared terror organisations by Israel.

After an 18-1 vote in favour of tougher security measures, Israel's national unity cabinet issued a statement saying "a wider scope of activity against Palestinian terrorism" was required.

But Labour Party ministers reportedly walked out of the meeting before the vote - they are now considering whether to stay in the coalition government.

Correspondents say Mr Sharon can continue in government without Labour backing.

US response

Senior Palestinian negotiator Saeb Erekat called Mr Sharon's speech a "declaration of war".

Dozens of Israelis died in attacks at the weekend

He called on the US "to interfere and stop Sharon before it's too late".

But White House spokesman Ari Fleischer has made it clear that the US will not try to rein Israel in.

"Israel is a sovereign power," Mr Fleischer said on Monday. "Israel has a right to defend itself."

Following the weekend's suicide bomber attacks on Jerusalem and Haifa, the Israeli army tightened its blockade around Palestinian towns and villages in the West Bank, while the Palestinian Authority declared a state of emergency in the West Bank and Gaza.

Palestinian security forces are reported to have arrested more than 100 militants on the West Bank and Gaza amid intense international pressure on Mr Arafat to take decisive action against radical Palestinian groups.

Most of those arrested belonged to Hamas, which said it carried out the weekend attacks, Palestinian security sources said.