Israel moves to cut off Hamas' air supply

The full weight of Israel's political machinery swung into action Sunday as the Jewish state prepared for the imminent formation of a new government dominated by Hamas.

The Israeli cabinet voted overwhelmingly to suspend the monthly transfer of tax duties to the Palestinian Authority (PA) that are worth 50 million dollars and constitute a third of its budget.

The sanctions will also see Israel pressuring the international community to "discontinue" all financial assistance to the PA, but without touching direct humanitarian aid to the people.

Washington, which has blacklisted Hamas as a terrorist organization, has also warned it will not give aid to a Hamas-controlled PA that rejects Israel's right to exist.

So far, the US administration has frozen a planned 234 million dollar aid package and is demanding the return of another 50 million dollars in unspent funds.

The return of the aid money was expected to feature prominently in talks between PA president Mahmud Abbas and visiting US Middle East envoy David Welch on Saturday, the first such meeting since Hamas' election win last month.

The US-Israeli campaign to choke off the radical movement's air supply also involves a diplomatic offensive aimed at dissuading any of their allies from forging ties with a Hamas government.

US Secretary of State Condoleezza Rice left Monday on a three-nation tour of the Middle East in a bid to shore up regional commitments to exert pressure on the new Hamas government.

Earlier this month, US and Israeli hopes of keeping Hamas isolated took a blow when Russian President Vladimir Putin invited the Islamic movement to Moscow for talks.

Infuriated by the decision, Israel began applying pressure. Acting Israeli Prime Minister Ehud Olmert has since secured a Russian pledge that Hamas will only meet with lower-level officials, Israeli media reports said.

Last week, Israel and Turkey had a sharp exchange of words after Ankara welcomed a top-level Hamas delegation for talks, with a senior Israeli official warning it could damage relations between the two countries.

Turkey, a predominantly Muslim but strictly secular state, has been Israel's main regional ally since 1996.

In a bid to coordinate US-Israeli efforts to destablise a Hamas-led PA, Yuval Diskin, head of Israel's domestic intelligence service, was expected for talks in Washington later this week, the Maariv daily reported.

A senior Israeli government official refused to confirm the report, but admitted Israel was working with Washington to "isolate" Hamas.

"We are in permanent contact with the Americans and are coordinating with them to try and isolate Hamas and strengthen moderate elements such as Mahmud Abbas," he said.

The hope is to exert so much pressure on the new Hamas government that it will collapse and new elections will have to be called, the New York Times reported last week, citing senior Israel sources and Western diplomats.

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