US President George W. Bush said Wednesday in his annual State of the Union address that he would ask the Congress to approve an aid package of 350 million dollars for the Palestinians.

"I will ask Congress for 350 million dollars to support Palestinian political, economic and security reforms," Bush said.

Bush voiced optimism for the establishment of an independent Palestinian state as he said it was "within reach."

"The goal of two democratic states, Israel and Palestine, living side by side in peace is within reach -- and America will help them achieve that goal," Bush said.

US Secretary of State Condoleezza Rice will visit Israel and the Palestinian territories early next week for meetings with Israeli Prime Minister Ariel Sharon and Palestinian leader Mahmoud Abbas.

"She (Rice) will discuss with them how we and our friends can help the Palestinian people end terror and build the institutions of a peaceful, independent, democratic state," said Bush.