Israeli Prime Minister Ariel Sharon's cabinet on Sunday approved his Gaza withdrawal plan, the first time an Israeli government has decided to evacuate settlements on land claimed by the Palestinians.

However, in another move, the cabinet also approved a modified route of the separation wall which runs deep into the West Bank, adding to Palestinian fears that Israel was cementing its grip on more territory and charting final borders.

The cabinet on Sunday voted 17-5 in favor of evacuating settlements in the Gaza Strip and northern West Bank. The pullout,which envisages a withdrawal of all 21 settlements from Gaza and four of 120 from the West Bank, will begin in July. The settlers will be given five month to evacuate.

Speaking later Sunday before American Jewish leaders in Jerusalem, Sharon said: "Israel has taken a step that will be decisive for its future ... the right one to ensure Israel's future as a Jewish and democratic state."

The approval of the pullout plan proved Israel's readiness to take "painful steps ... to make peace," he said.

After the vote, Sharon and Defense Minister Shaul Mofaz are dueto sign the evacuation orders. Further ministerial votes will be needed to implement the four phases of the disengagement plan.

Polls show most Israelis welcome the withdrawal, but ultranationalists say it will be a "reward for Palestinian terrorism" and many settlers believe the land is theirs by biblical birthright.

Israel's planned withdrawal has been touted as a step toward reviving the roadmap peace plan that would lead to a Palestinian state alongside Israel. Both Israelis and Palestinians called the plan a possible step towards peace.

However, in another vote hours after the passage of the evacuation plan, the Israeli cabinet approved a modified route of the separation wall in the West Bank, adding to Palestinians' fears that Israel would further cement its grip on larger chunks of the West Bank land and imposing de facto borders.

The new route, modified in accordance with a High Court of Justice ruling, will take in Ma'aleh Adumim, east of Jerusalem, which is the biggest settlement in the West Bank.

The modified route will bring the fence closer to the Green Line, the pre-1967 border between Israel and the Palestinians. Israeli government sources said the US administration had acceptedthe new route.

The new route draws Palestinian opposition. Palestinian chief negotiator Saeb Erekat called upon Israel to remove the separationwall, which was seen by many Palestinians as a land grab. He warned that if Israel continues the wall construction, all negotiations will fail.

Secretary General of the Palestinian cabinet Hassan Abu Lebda also warned on Sunday that the chance for peace would be unavailable if Israel continues building the separation wall in the West Bank.

"We want to tell the international community that the separation wall confiscates the Palestinians' lands and must be demolished and removed," he said. "If Israel wants to build it, itshould be build within its own borders."

He also urged Washington and the international quartet -- Russia, the United Nations, the European Union and the United States -- to step in to push forward the peace process and supervise Israel to honor its peace obligations.

In another development on Sunday, a group of 16 Palestinians expelled two years ago by Israel from the West Bank to Gaza Strip returned home in an Israeli friendly gesture to Palestine's new leader Mahmoud Abbas.

Israel also announced on Sunday that it would free 500 Palestinian prisoners on Monday in accordance with agreements reached at a landmark summit between Sharon and Abbas earlier thismonth.

Yet another positive sign for the Middle East, the Israeli Foreign Ministry said Sunday that Israel would approve an Egyptianrequest to send in a new ambassador. A new Jordanian ambassador took up his post in Israel on Sunday.

Egypt and Jordan withdrew their ambassadors shortly after Palestinian-Israeli conflicts erupted in September 2000. The two countries agreed to resume relations at ambassadorial level with Israel after the Sharon-Abbas summit in Egypt.

Source: Xinhua