Israel remains divided over the outcome of US President George Bush's landmark meeting with his Palestinian counterpart, Mahmoud Abbas.
While Israeli Prime Minister Ariel Sharon's office presented the summit as business as usual, Jewish hardliners branded it a failure for Israel and left-wing Deputy Prime Minister Shimon Peres clamoured for more settlements to be dismantled.
After his first-ever talks with a Palestinian leader since being elected in 2001, US President George Bush on Thursday reaffirmed US support for a Palestinian state, praised Abbas and pledged $50 million in direct aid.
He also urged Israel to halt illegal settlement activity in the occupied West Bank, dismantle outposts and withdraw troops to positions held before the outbreak of the intifada in September 2000.
Defeat for Israel?
"Bush's speech was a defeat for Israel," said chairman of the parliamentary defence and foreign affairs committee, Youval Steinitz.
"He praised Abu Mazen (Abbas), but he has done nothing against terrorism and allowed terrorist organisations to continue to rearm," said the MP from Sharon's right-wing Likud party.
Bush agreed to give $50
million in aid to Palestinians
The Israeli government has repeatedly accused Abbas of failing to disarm Palestinian resistance groups despite a de facto truce, which has been in place since the Palestinian leader was elected in January.
Furthermore, said Steinitz, the Abbas-Bush summit made "worthless" a 2004 letter from Bush that signalled clear support for Israel holding on to large West Bank settlement blocs under a final status agreement.
Israeli officials unfazed
To appease settlers and the hardliners, up in arms over his plan to uproot all Jewish settlers from the Gaza Strip this summer, Sharon has claimed Israel will cement its grip on settlements in the West Bank with US support.
From mid-August, the Israeli government is to dismantle all 21 settlements in the occupied Gaza Strip, as well as another four in the northern West Bank.
But Israeli officials appeared unfazed, saying the warm welcome laid out for Abbas was only to be expected after Washington boycotted his predecessor Yasser Arafat for years.
Many Israelis felt the praise for
Abbas was misplaced
"Disappointment does not come into it because President Bush has not changed position," one Sharon aide said. "The president made no concession on the need to fight terrorism," he added.
The Israeli press was unconvinced.
Palestinians score points
"He (Bush) adopted the democratic and peace loving aspect of Abu Mazen's regime, but disregarded what Israel views as a dangerous failure on the war on terrorism," said the Yediot Aharonot daily.
"It can be said that the Palestinians gained a few points yesterday, and Israel lost some," added the newspaper's editorial.
Despite the criticism, Sharon's office again refused to be drawn.
"Mahmoud Abbas got good grades, but he doesn't have his diploma yet," said an aide of the premier, seeing the summit as a blessing for the Palestinian chief to continue his mandate but a warning there is still a long way to go.
Peres said Israel must evacuate
"Abu Mazen (Abbas) has begun to do things, but you can't say he's done enough to start the negotiations on the roadmap," added the source.
Nevertheless Peres, whose Labour party joined the Sharon coalition primarily to shore up the Gaza pullout, said Israel must dismantle more settlements in the occupied West Bank.
"Facts will not allow Israel to rest on its laurels after the Gaza pullout, we must evacuate other settlements. It is inconceivable that all settlements remain," he said.
The Palestinian resistance group Hamas on Friday said renewed condemnation from US President George Bush calling the organisation a "terrorist" outfit was unjustified.
"We in Hamas reject Bush's statement as unjust and unfair," official Ismael Hanyeh said, one day after landmark talks between Bush and Palestinian leader Mahmud Abbas in Washington.
"I'm asking who is the victim? Palestinians who are killed in the occupation ... or those who have killed us, destroyed our houses and occupied our territories," he added.
On Thursday, Bush renewed criticism of Hamas as a "terrorist
group", saying groups that used violence as a political tool would ultimately find it impossible to achieve their goals of a