After more than half a century of struggle, Palestinians are close to creating an independent state. In a few weeks, the newly elected Palestinian president, Yasser Arafat, will form a government largely drawn from the 88-member Palestine National Council chosen by Palestinian voters on Saturday. The battle that has convulsed the Middle East since Israel was created in 1948 may not be over, but in the past 10 weeks it has been transformed by three events: the assassination of Yitzhak Rabin, the withdrawal of Israeli forces from the cities of the West Bank and the Palestinian elections.
The new state is a strange jigsaw puzzle of competing authorities. Israeli troops are still camped outside the cities they once controlled. There are 135,000 Israeli settlers in the West Bank and Gaza. But Palestinians believe that the 28-year-long occupation by Israel is finally ending. That is why they voted for Mr Arafat and his political movement, Fatah, at the weekend. Israeli opponents of the Oslo peace accords admit that they will never reconquer the land now being given up.
The withdrawal is a partial reversal of the results of the 1967 war, when Israel captured the West Bank, Gaza and East Jerusalem. Yet as Yossi Beilin, the Israeli minister who was one of the architects of the Oslo agreement, recently acknowledged: "Israel's sensational victory of 1967 has become a curse." It inflamed Palestinian nationalism. Israel became absorbed in trying to crush Mr Arafat and the Palestine Liberation Organisation. Military victories, such as the invasion of Lebanon in 1982, brought it no nearer a political settlement. The intifada (uprising) in the West Bank and Gaza in 1987 showed that resistance to Israel was growing.
Will the emergence of a quasi-independent Palestinian state remove the curse? For the moment, the Palestinians are euphoric. Israeli opponents of withdrawal from the West Bank cannot protest too vigorously because this could be seen as approval for the 4 November assassination of Yitzhak Rabin. But the situation remains fluid. Negotiations on the future of Jerusalem, the settlements and the frontiers of the two states have not yet begun. Neither Israelis nor Palestinians know if the future holds an armed truce or a long peace.
Within a month Mr Arafat will appoint a government, 20 of its members drawn from the Palestine National Council and five from outside it. Its powers will be restricted by agreements with Israel, but it is stronger than it appears. Formally, it is not allowed to conduct foreign policy, but hardly a week goes by when Mr Arafat is not receiving a foreign leader in Gaza. The new state has no army, but its large police force consists of soldiers with submachine guns in camouflage uniforms.
Critics of the Oslo agreement say the Israelis can at any moment seal off parts of the fragmented territory under Mr Arafat's control.Israeli troops still have the right to enter villages on the West Bank, where two-thirds of Palestinians live.
Yet in reality this is sooner said than done. During the intifada, Israel had difficulty enough controlling the West Bank and Gaza, even when it poured in troops and was in charge of the cities.
The ponderous 314-page peace agreement signed by Mr Rabin and Mr Arafat in September appears to have been written to confuse. But the Israeli right's analysis was correct: it is a more radical document than it looks - Israel is withdrawing from the West Bank.
The consequences for the PLO are no less far-reaching. For 30 years Mr Arafat and the PLO were supported by the Palestinian diaspora in Lebanon, Jordan, Syria and the rest of the Arab world. He formed a sort of government- in-exile. Only the 2.3 million Palestinians in the West Bank, Gaza and East Jerusalem voted on Saturday. Palestinians abroad - in Jordan alone there are two million - are left out on a limb. The PLO has been dissolving ever since Mr Arafat left Tunis for Gaza in 1994.
It should be no wonder that there is strong opposition to the Oslo accords in the refugee camps of Lebanon and Syria. It is they who fought for Mr Arafat in the ferocious battles of the Lebanese civil war, and their comrades were massacred in Sabra and Chatila during the Israeli invasion in 1982. Jordan is full of Palestinians forced out of Kuwait after Mr Arafat supported Iraq during the Gulf war. None of these communities gain anything immediately from the Israeli withdrawal from the West Bank and Gaza. Resentment there against Mr Arafat will only grow.
But opponents of the Oslo agreement will find it difficult to use the disappointment of the diaspora to oppose Mr Arafat. Political activists will return to Gaza and the West Bank, depriving the diaspora of its leadership. The hard core who remain in Damascus will be marginalised.
What it means for Israel The assassination of Yitzhak Rabin still dominates Israeli politics. The bullets that Yigal Amir fired into his back after a peace rally in Tel Aviv were the culmination of opposition to the peace process. They were also its nemesis. As Israeli forces withdrew in December, the nationalist right could do nothing. Its first rally in Jerusalem since Mr Rabin died, held last Saturday, was a tepid affair, focusing more on the defence of Jerusalem. It implicitly recognised that the battle for the West Bank is lost.
This does not mean that the Israeli settlers are going to pack their bags. But the settlements originally had more ambitious plans than survival. They were to be the vanguard of Israeli annexation of the West Bank, which they believed was given by God to the Jews. Like the Pilgrim Fathers sailing to New England in the 17th century, the most extreme settlers believed that on the West Bank they could build the foundations of the theocratic state that they wanted Israel to become.
The dream ended with the death of Mr Rabin. The religious nationalists, who combine exclusive Judaism with territorial nationalism, need the sympathy and support of the mainstream right. They are not getting it.
Danny Hizmy, a religious settler in Hebron, lamented last week: "The assassination of Rabin changed something in our people, especially in the settlements. Leaders of the right in Israel feel accused. They stopped protesting. Today Peres can do anything he wants. To give the Arabs six or seven cities in three weeks is terrible."
Bibi Netanyahu, the leader of Likud, the main right-wing party, had raised the political temperature in the summer and had sought the support of settlers. Now he is distancing himself from them. But it may be too late. He was badly damaged by Leah Rabin's refusal to shake hands with him because he set the stage for her husband's murder.
The right is not finished, however. Surprisingly, Shimon Peres, Mr Rabin's successor, has focused on reaching peace with Syria by withdrawing from the Golan Heights. It is not a popular move with the Israeli public. Mr Netanyahu will try to fight the election planned for October on this issue, not on the peace accords with the Palestinians.
The future of the peace process
The Oslo agreement of 1993 postponed until the end the most difficult problems: the future of Jerusalem, the settlements, and the Palestinian refugees. These last talks must start by 4 May. They will not be easy.
The Palestinian election on Saturday was peaceful except in Jerusalem. Lines of Israeli police and troops ensured that only about 30 per cent of Palestinians in East Jerusalem were able to vote. Hanan Ashrawi, the human rights activist, said: "The battle for Jerusalem has already begun." The Israeli position is that Jerusalem is and will remain the eternal and undivided capital of Israel. But by allowing Palestinians in Jerusalem to vote in the West Bank elections as part of a constituency that extends outside the city, Israeli sovereignty has already been diluted. The future of Jerusalem will be the bitterest issue in the talks.
The settlers can no longer expect to take over the whole of the West Bank. They have lost their ideological cutting edge. The official Israeli position is that the government supports the settlers' right to stay. However, privately, compromise is in the wings. About 70 per cent of the settlers live on only 11 per cent of the land of the West Bank. Israeli ministers believe that this land might be annexed to Israel. The remainder would have to abandon the settlements or get used to living in Palestinian- dominated areas. The Palestinians want the settlers out altogether, but have no means to force them.
On the Palestinian side, it is refugees who have done worst out of the Oslo deal. The politically active and wealthier refugees may come back to where Mr Arafat rules. But Palestinian families that became refugees after the 1948 war will get nothing under the Oslo accords. They will not be allowed to return to their homes. The majority of the Palestinian diaspora will remain abroad and marginalised.Reuse content