Death raid on Israeli base

Two Palestinian gunmen, one reported to be in uniform, attacked an Israeli army base today, killing four soldiers. Both gunmen were later shot dead.

The gunmen raided Kerem Shalom, a village in undisputed Israeli territory near the Gaza Strip, shortly before dawn. They threw grenades and fired automatic weapons at Israeli troops. One was killed in the ensuing gun battle, the other was hunted down by Israeli reinforcements.

Islamic militant group Hamas claimed responsibility for the attack, which shattered the most peaceful week in more than a year of violence between Palestinians and Israelis.

The Israeli government called the attack "very grave" and "murderous". It follows a New Year broadcast by Palestinian leader Yasser Arafat in which he condemned suicide attacks and other acts of terrorism.

Arafat's move appeared to have had a calming effect as his security forces attempted to round up extremists from Hamas, Islamic Jihad and other guerrilla organisations dedicated to the destruction of Israel.

As soon as news of today's assault spread through the Gaza Strip, Arafat's security forces fled their offices and other positions, bracing themselves for Israeli retaliation.

Arafat has been stuck in Ramallah, on the West Bank, since his helicopters were destroyed in Israeli air strikes after a wave of suicide bombings last month when Israel also invaded large swathes of territory under the control of his Palestinian Authority.

Israel has long accused Arafat of failing to stop terror attacks, and of actively encouraging the killing of civilians and military personnel in the Occupied Territories.

Last week Israeli commandos captured a shipment of 62 tons of weapons, including long-range Katyusha rockets, off the coast of Egypt and accused the Palestinian Authority of being behind the attempt to smuggle weapons into the area.

Israeli prime minister Ariel Sharon said at least one member of Arafat's Palestinian navy was captured on board the ship.

Today Israeli radio claimed one of the guerrillas who attacked Kerem Shalom was in the uniform of the Palestinian navy, one of Arafat's best trained units, originally established to monitor the activities of groups opposed to the now dead peace process with Israel.

Sharon's security cabinet went into an emergency session to discuss its response to today's raid. He is certain to accuse the Palestinian Authority of involvement.

The expected reprisal raids will target Authority forces, whom he has demanded must round up Hamas and others suspected of being behind suicide bombings and other acts of terror.

In a clear sign that Arafat's control over Palestinian areas nominally under his control is fast failing, today his men were locked in a gun battle in the Gaza Strip with Hamas after they tried to arrest a suspected terrorist.

At least one member of Arafat's security forces was injured in the Shati refugee camp.

A Hamas spokesman called the incident "an attack calculated to set off a civil war".