Friday, May 27 2005 09:41 Hrs (IST) - World Time -

Washington: US President George W Bush yesterday (May 26, 2005) assured Palestinian Authority (PA) President Mahmoud Abbas that he is committed to the creation of a democratic Palestinian State living side by side with a democratic Israel.

At a joint press conference in Washington after his first White House meeting with a Palestinian leader in four years, Bush said, "I believe that the Palestinian people are fully capable of justly governing themselves in peace with their neighbours... I believe the interest of the Israeli people would be served by a peaceful Palestinian State."

Abbas reaffirmed his commitment to peace and democracy but on the substantive issues, raised Palestinian demand for 1967 borders with East Jerusalem as the capital of Palestine.

In a significant gesture to Abbas, whose commitment to democracy and peaceful methods he praised warmly, Bush reiterated his public call to Israel not to undertake any activity that contravenes the "road map" obligations and final status negotiations with regard to Gaza, the West Bank and Jerusalem.

Israel, he said, must remove unauthorised outposts and stop settlement expansion. The barrier being erected by Israel as a part of its security effort, said Bush, must be a "security barrier rather than a political barrier" and its route should be consistent with security needs, and its impact on Palestinians not engaged in terrorist activities.

"As we make progress towards security and in accordance with the road map," said Bush, "Israeli forces should withdraw to their positions of September 28, 2000."

Bush said that any final status agreement must be reached between the two parties and changes to the 1949 armistice lines must be mutually agreed to. A viable two-State solution, said Bush, must ensure continuity of the West Bank. A State of scattered territories, he said, will not work. There must also be meaningful linkages between the West Bank and Gaza.

"This," said Bush firmly, "is the position of the United States today. It will be the position of the United States at the time of final status negotiations."

Bush, who went out of his way to proclaim support for the new Palestinian leadership, including a direct grant of $ 50 million for housing and infrastructure assistance in Gaza, indicated that he would not object to Hamas participating in Palestinian elections but the US, he stressed, views it as a terrorist organisation and will continue to do so.

"You cannot have a democracy based upon the rule of law if you have armed bands of people who will use their weapons to achieve a political outcome," said Bush. Abbas, he said, understands that aspect of democracy.

Abbas said Palestinian Authority is ready to "coordinate with Israel to ensure the success of its withdrawal from Gaza and the West Bank upon the Israeli evacuation. We see this evacuation as a part of ending the occupation, and it should not be at the expense of the West Bank".

Therefore, "We must then immediately move towards permanent status negotiations, dealing with issues at the core of the conflict, namely East Jerusalem - the capital of the future Palestinian State - refugees, settlements, borders, security and water on the basis of President Bush's vision, United Nations resolutions and the Arab Peace Initiative.

"It is time for the Palestinian-Israeli conflict to end, right now," the Palestinian leader said.

Stressing that "democracy cannot flourish under occupation and in the absence of freedom," the Palestinian leader expressed concern over the "continuous Israeli settlement activities and the construction of the wall on our land, particularly in the area of Jerusalem".

"These settlement activities, in addition to undermining President Bush's vision in establishing a Palestinian and contiguous State, that it is a viable state that can live side-by-side by the State of Israel, also contributes to the feeling of frustration and despair and the loss of hope.

"Time is becoming our greatest enemy. We should end this conflict before it is too late...We are extending our hands to the Israeli people in good intention," Abbas said.

Praising Abbas for his rejection of terrorism, Bush emphasised, "All who engage in terror are the enemies of a Palestinian State and must be held to account."

He also urged Arab States to take concrete measures to create a regional environment conducive to peace. "They must offer financial assistance to all - to support the peaceful efforts of President Abbas, his Government and the Palestinian people. And they must refuse to assist or harbour terrorists."

"The imminent Israeli disengagement from Gaza, parts of the West Bank, presents an opportunity to lay the groundwork for a return to the road map," the US President said.

Bush said he asked Secretary of State Condoleezza Rice to travel to Jerusalem and Ramallah before the beginning of the Israeli withdrawal and consult with Israelis and Palestinians on the disengagement.

However, he said, "As we work to make the disengagement succeed, we must not lose sight of the path ahead. The United States remains committed to the road map."