Israeli Prime Minister Ariel Sharon said Monday that his government had begun coordination with the Palestinians in a bid to make the unilateral disengagement plan to withdraw settlers from the Gaza Strip a success.

"Significant talks on this issue had begun only recently," Sharon told visiting US Senator Bill Frist and Joseph Lieberman.

"Israel wants to coordinate the disengagement plan with the Palestinians and make certain that the withdrawal from the Gaza Strip is coordinated, without terrorism, and that Israeli property is transferred to the responsibility of the Palestinian Authority, which would use it to serve the welfare of the Palestinian population," he said.

Sharon said he had charged vice premier Shimon Peres with the responsibility of raising funds in order to assist Palestinian economic recovery after the Israeli withdrawal from Gaza.

Sharon said that he remained committed to implementing the disengagement plan as scheduled for this summer despite domestic difficulties.

"This is a painful step that Israel has yet to undertake. Feelings in Israel are harsh, there are many demonstrations, there is great tension and there are various attempts to oppose the move," he said.

Meanwhile, Sharon criticized Palestinian leader Mahmoud Abbas for completely avoiding taking significant steps to disband the militant groups though Abbas was taking steps to maintain the quiet.

Abbas has ordered Palestinian security forces to use "iron fist" if needed to ensure that militant groups keep the truce with Israel.

But the armed Islamic Jihad group threatened to resume attacks in response to the latest Israeli violation of the ceasefire in which an Israeli soldier and a Jihad militant were killed Monday morning in gun battle as Israeli army stormed a village near Tulkarm to arrest Palestinian suspects.