JERUSALEM, Feb 28 (Reuters) - Israeli Prime Minister Ariel Sharon's hawkish coalition is likely to pursue a tough line on the Palestinian revolt and peace-making after parliament gave the new government a stamp of approval on Friday.
The cabinet was presented a day after U.S. President George W. Bush said he would push for an Israeli-Palestinian peace settlement after any military action in Iraq.
The 120-member parliament voted 66-48 in favour of the coalition Sharon presented on Thursday, kicking off a session of speeches by lawmakers that lasted past midnight (2200 GMT).
In a speech, Sharon repeated his position that Palestinians must stop "incitement and terror" and implement deep democratic reforms before any political negotiations can resume.
He said Palestinian leader Yasser Arafat must be replaced and ruled out a return of Palestinian refugees to homes they fled during the 1948 Mideast war, a major Palestinian demand.
Any flexibility Sharon may seek during negotiations will be hampered by his hawkish coalition, which includes fierce opponents of Palestinian statehood and staunch supporters of Jewish settlements on lands occupied by Israel in 1967.
"It is a government that will serve settlement activities and undermine the roadmap plan," Palestinian cabinet minister Saeb Erekat told Reuters.
A quartet of mediators from the United States, the United Nations, the European Union and Russia is trying to push forward a staged peace proposal.
The so-called "roadmap," which sets as its ultimate goal the establishment of a Palestinian state in 2005, aims to calm nearly 29 months of hostilities, which flared again on Thursday.
Palestinians said Israeli helicopters opened fire into the northern Gaza Strip city of Beit Hanoun late on Thursday. There were no immediate reports of any casualties.
The Israeli army has intensified operations in the strip since militants blew up an Israeli tank and killed four soldiers earlier this month. Military sources confirmed helicopters were operating in the northern area of the strip but gave no details.
SHARON LAYS DOWN TOUGH CONDITIONS FOR PEACE
While the 75-year-old Sharon made no mention in his speech to parliament of the U.S.-backed "roadmap" to Palestinian statehood, he said he would accept a demilitarised Palestinian state as an ultimate solution to the conflict.
But he added that any negotiations on the matter would require special approval in his cabinet, which he acknowledged was divided on the issue.
"The people of Israel seek peace and I am convinced that for real peace there is a willingness for painful concessions," Sharon told parliament.
Likud has built a coalition of 68 seats with the centrist Shinui party, the ultranationalist National Union and the National Religious Party, a champion of Jewish settlements on occupied land.
All four parties favour a hard line with the Palestinians, but the National Union party, with seven seats, takes the most extreme view. Some of its leaders advocate pushing Palestinians out of the West Bank and annexing the land to the Jewish state.
A decision by the centre-left Labour Party to stay out of the new coalition left Sharon without the more moderate partner he sought ahead of anticipated U.S. pressure for concessions to the Palestinians after any U.S.-led war on Iraq.
Bush said on Wednesday that ousting Iraqi President Saddam Hussein would open the way to Middle East peace.
He said that "as the terror threat is removed and security improves", Israel's new government would be expected to support creation of a Palestinian state, work as quickly as possible towards a final agreement and end Jewish settlement building.
- Reuters - Thomson Reuters Foundation
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