Israeli troops swept into Jenin refugee camp Monday and hunted house-by-house for Palestinian militants, witnesses said, as Israel's defense chief insisted a security deal meant to ease violence remained intact. The so-called "Gaza-Bethlehem First" arrangement, in which Israeli forces vacated Bethlehem last week, is viewed as a test for a wider withdrawal and eventual truce in the Palestinian uprising, but has bogged down in discord over the next steps.

Israeli soldiers in armored vehicles entered the Jenin camp, scene in April of the bloodiest fighting in the 23-month-old Palestinian revolt, in a fresh search for militants of the groups Hamas and Islamic Jihad, local witnesses said.

They said Palestinian gunmen shot at troops as they rolled into the camp and drew return fire, but there had been no resistance since soldiers began going house-to-house in the densely-populated warren of alleyways.

Israeli occupation army radio said troops had gone into the refugee quarter before dawn but gave no further information.

The occupation army has re-entered the camp, a haven of Islamic militants, several times since the April battle in which it suffered its worst casualties -- including 13 soldiers killed in a booby-trapped house -- in a spring offensive across the West Bank spurred by a wave of Palestinian resistance bombings.

Citing what it called persistent intelligence warnings of resistance attacks, Israeli forces resumed raids for militants at the weekend amid an apparent stalemate over how to broaden the "Bethlehem-Gaza First" plan.

The plan envisages phased occupation army withdrawals from areas of the West Bank and Gaza granted self-rule under 1994-95 interim peace deals in return for Palestinian police taking forthright action to curb militant violence.

But a pledge to relax restrictions on Palestinian travel in the Gaza Strip has yet to be carried out and Israeli officials dismissed the prospect of a new withdrawal from the divided city of Hebron in the near future.

Palestinian officials said Israel had effectively frozen the Gaza-Bethlehem deal after talks on a Hebron pullout foundered at the weekend. Some 400 Israeli settlers live in the divided West Bank city amid about 150,000 Palestinians.

ISRAEL SAYS DEAL STILL IN PLACE

Israeli Defense Minister Binyamin Ben-Eliezer denied the plan had been shelved but said Palestinian security services had not done enough to live up to their end of the deal.

"It is not dead. It lives. How can you expect a complete change in the situation in two days after a conflict running (almost) two years? I expect efforts from them. All the easing of conditions we promised we executed," he told occupation army radio.

Ben-Eliezer said one serious problem was that the Palestinian Authority had so far failed to persuade Hamas and Islamic Jihad to honor the arrangement.
"We are at the beginning of the road. This is a process of step after step after step," he added.

Militant groups reject renewed dialogue with Israel and have vowed to keep up attacks despite an appeal by Palestinian Interior Minister Abdel Razzak al-Yahya to representatives of Palestinian national and Islamic factions.

"I made clear to all that this agreement is merely the first step toward ending the Israeli occupation and siege imposed on our cities" to pave the way for Palestinian leadership elections next year and renewed Middle East peacemaking, Yahya said.

The United States, the key Middle East peace broker, has made new elections and democratic reforms to Palestinian security services and financial institutions a condition for progress on establishing a Palestinian state.

At least 1,510 Palestinians and 589 Israelis have been killed since the start of the revolt in September 2000 after talks on establishing a Palestinian state hit an impasse.

In the West Bank city of Tulkarm Saturday, militants affiliated with Palestinian President Yasser Arafat's Fatah movement executed mother-of-three, Ikhlas Yassin, 35, accused of collaborating with Israel, Palestinian security sources said. It was the first time a woman had been killed as an alleged Israeli collaborator.

PHOTO CAPTION

Two Palestinian members of the Legislative council sit in an empty hall during the council's meeting as the Israeli occupation army lifted the curfew for five hours in the West Bank City of Ramallah, August 26, 2002. The Palestinian council met to discuss reforms in the Palestinian government as most of the members cannot attend the meeting due to an Israeli curfew in the West Bank. REUTERS/Osama S