Israel seethes after Abbas-Bush summit

After his first-ever talks with a Palestinian leader since being elected in 2001, US President George W. Bush on Thursday reaffirmed US support for a Palestinian state, praised Abbas and pledged 50 million dollars in direct aid.

He also urged Israel to halt settlement activity in the occupied West Bank, dismantle illegal outposts and withdraw troops to positions held before the outbreak of the Intifada in September 2000.

While Prime Minister Ariel Sharon's office presented the summit as business as usual, the right-wing branded it a failure for Israel and left-wing Deputy Prime Minister Shimon Peres clamoured for more settlements to be dismantled.

"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.

The Israeli government has repeatedly accused Abbas of failing to disarm militant 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 onto large West Bank settlement blocs under a final status agreement.