Palestinian leaders said on Sunday they were postponing elections scheduled for January because of Israeli military occupation of West Bank cities, and a new international call for a truce seemed doomed. In new violence, the Israeli occupation army said it shot a Palestinian resistance activist in the Gaza Strip. Israeli media said he was killed.

Israel and the Palestinians put the ball in each other's court over the truce call by a so-called Quartet of Middle East mediators -- the United States, United Nations, European Union and Russia -- who are putting together a new peace plan designed to end two years of bloodshed that has killed some 2,400 people.

Palestinian President Yasser Arafat's cabinet said it would agree to a cease-fire but only if Israel did the same. Israeli Foreign Ministry spokesman Yoni Peled said: "If there is a change in the Palestinian strategy and we see...an end to the violence, then Israel will happily negotiate its redeployment out of (Palestinian) areas."

Israel, turning its attention to the possibility of a U.S.-led war against Iraq, said it planned joint exercises with U.S. forces and gas mask lessons for children. Washington is playing a balancing act. It is Israel's guardian ally, but also wants to calm Israeli-Palestinian violence so it can try to woo Arab states over any war on Iraq.

Announcing the Palestinian Authority's decision to indefinitely postpone planned January 20 elections, cabinet minister Saeb Erekat said: "Due to the Israeli reoccupation, obstruction and closures, it is impossible (to hold the vote)."

Israel sent troops into West Bank cities earlier this year following waves of Palestinian resistance bombings, its tanks often isolating Arafat in his battered headquarters in Ramallah. The violence was triggered by a Palestinian uprising for statehood that began in September 2000.

ARAFT BUOYED AT HOME BY EXTERNAL CRITICISM

With U.S. backing, Israel has deemed Arafat a "terrorist" irrelevant to any future peace prospects and has encouraged rank-and-file Palestinians to oust him. But opinion polls show his support among Palestinian voters is strong, with even reform-minded officials backing him.

"The world which is demanding reforms and democratic life in Palestine should pressure Israel to withdraw so that we can move and vote," Jamal Shati, a lawmaker from Arafat's Fatah movement who has been calling for elections since 1997, told Reuters. Ordinary Palestinians welcomed the postponement of the vote.

"This is the right decision because how can people move while tanks are in towns? How can candidates move freely," said Nael Arar, a teacher in the West Bank city of Ramallah.

An Israeli occupation army spokesman said that on Sunday night, occupation troops shot a Palestinian resistance man who approached a military outpost on Gaza's border with Egypt, adding that he was carried away by comrades. Israel Radio and occupation Army Radio said in un-sourced report that the alleged resistance man died.

Palestinian officials did not immediately comment.

PHOTO CAPTION

Palestinian leader Yasser Arafat presides over a cabinet ministers session at his headquarters in the West Bank town of Ramallah, Sunday, Dec. 22, 2002. The Palestinian Cabinet accepted the recommendation of its election commission to delay the vote, set for Jan. 20, until 100 days after Israeli troops leave West Bank cities and towns. Since the Israelis have given no signs that they are preparing to pull back, that amounts to an indefinite postponement. (AP Photo/Omar Rashidi, HO)
- Dec 22 3:36 PM