Sharon to meet Peres for talks on Israeli unity government

Ariel Sharon, Israel's Prime Minister, took the first step towards recasting his government last night when he announced he would meet Shimon Peres, the Labour leader, for preliminary talks this weekend on forming a new coalition.

Mr Sharon wants to form a new unity government of the Israeli political centre to guarantee support for his plan to withdraw the 7,500 Jewish settlers from Gaza by the end of next year - a plan bitterly contested by his far-right coalition partners and many in his own Likud party.

Although Mr Sharon's intentions were well known, the timing of the announcement at an economic conference in Caesarea came as an unwelcome surprise to right-wing critics.

Meanwhile Gaza saw the worst violence since the Israeli army moved into the northern neighbourhood of Beit Hanoun last week, when soldiers killed at least seven Palestinians, including several militants. Two of the most senior army officers serving in the strip were wounded when their jeep was attacked by missiles and a roadside bomb.

Islamic Jihad claimed responsibility for the attack on the jeep, which wounded five soldiers including Colonel Pinky Zuaretz, a brigade commander, and Colonel Yossi Turjeman, a co-ordinator of the disengagement plan in Gaza.