Israel to cut Arafat links and widen use of military

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Bloodiest attack delivers massive blow to Arafat

Israel will sever ties with Palestinian leader Yasser Arafat and launch widescale military operations in cities on the West Bank and Gaza Strip, in response to yesterday's Palestinian gun attack on a bus that killed ten people.

A senior Israeli source said the decision was reached in a security cabinet meeting in Tel Aviv. The source said the cabinet decided Arafat was "directly responsible for the series of terror attacks and has therefore decided...(that) Yasser Arafat is no longer relevant to the State of Israel and there will be no more contact with him".

Israel has launched more air strikes on Palestinian towns, one man is said to have been killed.

Israeli tanks have advanced to within 100 metres of Mr Arafat's headquarters and bulldozers have destroyed the headquarters of the Palestinian broadcasting authority. A Palestinian spokesman has described Israel's retaliatory strikes as "an official declaration of war."

The latest attack by Palestinians is the bloodiest assault on Israelis in the occupied territories since the start of the uprising. A spokeswoman for Israel's armed forces said 10 people had been killed. Israel retaliated with a severe pounding of the Gaza Strip. F-16 jets fired at least five missiles atYasser Arafat's headquarters in the Gaza Strip and bombedNablus in the West Bank.

In the bus attack, Palestinian militants fired automatic rifles and threw hand grenades after stopping the vehicle with at least one roadside bomb yards from the Jewish settlement, Emmanuel on the northern West Bank. More than two dozen people were reported injured and one gunman was shot dead.

There were signs that it was co-ordinated with two almost simultaneous suicide bombings in Gaza, which injured several Israelis. Witnesses and Israeli medics ­ who said they were shot at by the gunmen ­ said the assault began as the bus approached the settlement.

As the scale of the killing became clear, Israel's Prime Minister, Ariel Sharon, called the US Secretary of State, Colin Powell. US envoy, Anthony Zinni, condemned the attack as a "murderous act of terror".

Mr Arafat appeared to try to salvage the situation last night. After the attack, Palestinian officials said there was an order to close all institutions of the militant Hamas and Islamic Jihad groups, including education, health and political offices. Israel is unlikely to take that seriously; it has derided Palestinian claims to have arrested 180 militants in recent days.

Last night the identity of the killers was unclear. The attack was claimed by the al-Aqsa Martyrs Brigade, a group affiliated with Fatah. But there were reports, too, that the Islamist nationalists Hamas were also claiming the attack.