The pullback is the fruit of a new security initiative brokered by a team of Palestinian negotiators, led by Interior Minister Abdel Razaq Yehiya and Israeli Defence Minister Binyamin Ben Eliezer. The plan, which calls for Israel to reduce its military presence in Gaza and the West Bank in exchange for Palestinian efforts to quell attacks on Israeli targets, was rejected by Palestinians when it was first proposed by Ben Eliezer on 5 August. This time the Palestinian team supported the plan. However, its success may be threatened by the decision of armed Palestinian factions including Hamas, Islamic Jihad and the leftist Popular Front for the Liberation of Palestine (PFLP) to reject the deal.

If it holds, the agreement will mark a major victory for Ben Eliezer, who was elected leader of Israel's Labour Party at the end of last year. The Iraqi-born politician is keen to carve out a distinctive position for himself on the Israeli/Palestinian conflict ahead of the general election, which, though not due until next October, may be called as early as January. Ben Eliezer's position at the helm of the Labour Party is under threat from Amram Mitzna, the mayor of Haifa, who declared in mid-August that he would be challenging Ben Eliezer for the post.

The Israeli withdrawal began on 20 August as troops pulled back from positions in the West Bank town of Bethlehem and nearby villages that they had occupied since June. The move provoked little rejoicing among the sceptical Palestinian population in the area who are still braced for a return of Israeli forces. 'The slightest excuse will see them back here again,' said one Bethlehem resident.

The fragility of the deal was underscored by continued violence in other areas of the West Bank still occupied by Israeli security forces. As in the past, Israel quickly raised the stakes - assassinating the brother of the PFLF head Ahmed Saadat, an act that will almost certainly provoke a violent response from the group. Mohamed Saadat was shot in Ramallah on 20 August by Israeli special forces who say they came under fire when they tried to arrest him. Elsewhere in the West Bank a Palestinian man was killed and another injured when Israeli troops raided Tulkarm refugee camp.

Plans for Israel to lift restrictions in the Gaza Strip as part of the confidence-building measures were thrown into array when troops, supported by tanks and helicopters, stormed a quarter of Khan Younis camp in the south of the strip on 21 August. The Israel army said it was under orders to 'destroy abandoned houses that are used as shelter or as firing positions' by armed Palestinians. It blew up two homes, partially demolished seven more, and damaged another 30, according to UN reports. A Palestinian man in one of the houses was killed.

The arrest by Israel of 15 Palestinians suspected of being involved in the 31 July bombing at Hebrew University has reopened debate in Israel over the possibility of revoking the citizenship of Arabs, resident in Israel, who have been involved in attacks against Israelis. Of the 15 alleged Hamas members detained for the bombing, four are from Arab East Jerusalem. Israeli Interior Minister Eli Yishai has already begun moves to annul the residency status of the four residents. 'Stripping the citizenship of someone who exploited this status to harm the state of Israel [is] necessary because of the growing number of cases in which Israeli Arabs exploit their Israeli ID cards to attack us,' Yishai said. 'We are in the midst of a war and we are obliged to protect ourselves.'