Har Homa protesters overrun shrine

Palestinian demonstrators hurl-ed rocks at Israeli troops in Bethlehem and Jewish settlers moved into a Palestinian district in East Jerusalem yesterday further damaging the prospects for a peace agreement aimed at ending the Arab-Israeli conflict.

The riot started when 300 students from Bethlehem University held a march protesting at the construction of a Jewish township at Har Homa between Bethlehem and Jeru- salem. As they approached Rachel's Tomb, a heavily fortified Jewish shrine protected by Israeli troops, 40 Palestinian police tried to hold them back, but were overrun.

Sheltering behind a wall by a petrol station, the soldiers fired tear gas grenades, but appeared to be under orders not to fire live rounds. A few stones came skimming towards the troops and Palestinian boys raced forward to lob back the gas gren-ades. "Perfume from Beth- lehem," said an Israeli policeman as choking onlookers were enveloped by a cloud of gas.

Yasser Arafat, the Palestinian leader, appeared to be trying to prevent protests against Har Homa turning violent, fearing the Palestinians might forfeit international support. Nabi Amir, an adviser to Mr Arafat, said on the Voice of Palestine: "The fruits of world support arrive gradually. It is thanks to such support we have come this far."

But there is a diminishing basis for co-operation or negotiations between Israel and the Palestinians. A proposal by Benjamin Netanyahu, the Israeli Prime Minister, whereby the present interim phase of the Oslo accords, intended to end the Israeli occupation of the West Bank, would be dropped and a final agreement reached by the end of the year, was dimissed by Palestinian leaders.

In Jerusalem another development is likely to deepen Palestinian suspicions. Over- night, apparently with the know- ledge of Mr Netanyahu, five families belonging to the extreme settler organisation, El Ad, moved into a large house formerly occupied by Palestinians in the Silwan district of Jeru- salem. This is one of the most heavily-contested areas of the city, as it is only 300 yards from al Aqsa mosque and occupies the site of ancient Jerusalem captured by King David. "The settlers came at 1pm. They have not said a word to us," said Mohammed Abu Diab, a Palestinian who lives next door to the building taken by El Ad. Several Israeli men inside the house said they were from a security firm and would not speak. Later, Yigaal Canaan, the leader of El Ad, said: "This whole hill is part of ancient Jerusalem and our organisation's goal is for the whole hill to become Jewish."

He is not far from his aim. House after house in Silwan is sprouting an Israeli flag. Under the Labour government between 1992 and 1996, no Palestinian houses were taken over. Instead, El Ad and its sister organisation, Ateret Cohanim (Crown of the Priests), was the target of a government inquiry into how they had illegally received official funds to obtain Palestinian houses. But on the morning of Mr Netanyahu's election victory last May - even before it was confirmed - El Ad resumed its campaign.

The settlers have little sympathy for Palestinian occupants. Amir Ben David, 32, a settler born in the US, will move into a house above the biblical pool of Siloam, next week. He said: "There was a family here before, but the courts told them to leave. This is the City of David."

Mr Ben David does not think Jewish settlement should end with the City of David. "Those houses are built on the graves of Jews from the time of the Second Temple [destroyed by the Babylonians in 587BC]."

The prime minister's office said that it had known of the take-over by settlers in Silwan, but had not initiated it. In practice, however, El Ad cannot act without coordination with the armed security guards paid for by the government.

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