The Palestinian president has announced that he will hold a referendum on July 26 on the establishment of a Palestinian state side by side with Israel, Aljazeera reports.

Mahmoud Abbas made the televised declaration on Saturday despite pleas by the ruling Hamas party to hold off on the vote and amid rising tensions in the area.

He set the July 26 date for the vote in a decree read by an aide.

Hours earlier, the Islamist group's armed wing ended a 16-month-old ceasefire with a barrage of rockets into Israel after Israel was blamed for the killing of 10 Palestinians in the Gaza Strip, including children and their parents at a beach on Friday.

Any major surge of violence could endanger the chances of the referendum on the manifesto, which the Hamas-led Palestinian government rejects.

Before Abbas' announcement on Saturday, officials of his Fatah movement said he was determined to go ahead despite what he called "a bloody massacre" in Gaza and the Hamas decision to abandon the truce.

"Any more delay will only lead to increased Israeli-Palestinian and Palestinian-Palestinian bloodshed," said one Fatah official.

Power struggle

Fears of increased Israeli-Palestinian violence, as well as internal Palestinian clashes, have grown as the struggle for power has intensified between Abbas and Hamas.

Hamas officials accuse Abbas of using the referendum to try to engineer the downfall of their government, which took office after trouncing Fatah in January elections but has struggled with a Western aid embargo and growing disorder.

Ismail Haniya, the prime minister, on Friday called on Abbas to shelve the plan for a referendum, saying that Palestinians should unite against Israel.

The proposed manifesto implicitly recognizes Israel by calling for a Palestinian state on all of the Gaza Strip and the occupied West Bank, which Israel captured in the 1967 Middle East war.

Israel withdrew from the Gaza Strip last year.

Opinion polls show most Palestinians back the proposal, drawn up by resistance fighters imprisoned in Israel.

'Internal game'

Israel has ruled out a complete withdrawal and the proposal's call for the return of millions of refugees and their descendants to what is now Israel.

Ehud Olmert, the Israeli prime minister, told Britain's Financial Times that "the referendum is an internal game between one faction and another".

"It is meaningless in terms of the broad picture of chances towards some kind of dialogue between us and the Palestinians."

Photo Caption

Palestinian PM Mahmoud Abbas