Olmert pullout plan to strengthen big settlements

JERUSALEM, Apr 8 (Reuters) Prime Minister-designate Ehud Olmert said, Israel will move settlers from some occupied West Bank enclaves to larger blocs under a plan he will pursue once he forms a government.

''In Gaza, we pulled out of all the territories and dismantled all the settlements,'' he told the Washington Post in an interview published on its Web site.

''Here, I'm talking about relocating many of the settlements into blocs that will be maintained by Israel.

''The rest of the territories will not have any Israeli presence and will allow territorial contiguity for a future Palestinian state,'' he said, reiterating similar comments he made before his centrist Kadima party won a March 28 election.

Israel quit Gaza in September after 38 years of occupation.

The Palestinians have condemned Olmert's plan, and President Mahmoud Abbas has said any attempt by Israel to unilaterally set its borders would delay a resolution to the conflict.

Olmert said Israel would press ahead with his plan if the US government, whom he plans to meet soon, agreed that the Palestinians and the new Hamas-led government were ''not ready for genuine and meaningful negotiations''.

He said ''Then I will try to reach an understanding with the administration as to what steps Israel should take -- what should be the border of Israel in order to reduce the level of confrontation between us and the Palestinians to a minimum.

The United States and the European Commission yesterday suspended direct aid to the Palestinian government until it renounced violence, recognised Israel's right to exist and supported internationally-backed West Asia peace initiatives.

Hamas, an Islamic group sworn to destroying the Jewish state and which has carried out about 60 suicide bombings against it, has said its cabinet would not bow to foreign pressure.

Kadima, formed by Prime Minister Ariel Sharon before a stroke in January, won the election on a platform of setting Israel's borders and evacuating some Jewish enclaves while retaining larger ones. It will launch coalition talks tomorrow.

Prior to the stroke, which left him comatose, Sharon had spoken of similar moves.

Reuters OM VP0052