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Hamas will go after Israeli spies in Gaza and might use bombs in its struggle with Fatah in the West Bank, Hamas founding member Mahmoud Zahar was quoted as saying to the German magazine Der Spiegel Saturday.

Zahar's remarks suggested that his group's offer of amnesty to members of the rival Fatah group is not ironclad and that Hamas will try to destabilize the Fatah-controlled West Bank.

Zahar is widely seen as one of the key players in Hamas' violent takeover of Gaza in mid-June. He staunchly opposed the brief government coalition between Hamas and Fatah and leads the movement's hardline wing.

In response to the takeover, the security forces of moderate Palestinian Authority Chairman Mahmoud Abbas arrested scores of Hamas activists in the West Bank, and Fatah-allied gunmen seized others, in some cases shooting them in the legs.

Zahar said Hamas loyalists in the West Bank would defend themselves in the same way they had targeted Israel during years of the Palestinian uprising - with bombs and attacks, according to the magazine.

He said Hamas would also go after Israeli spies, an apparent reference to Fatah loyalists close to former Gaza strongman Mohammed Dahlan, who now lives in the West Bank. Hamas has repeatedly denounced Dahlan as a traitor because he favors dialogue with Israel and the U.S. and has participated in many high-level meetings with Western officials.

Hamas chief Haniyeh calls for fresh Hamas-Fatah talksHamas leader Ismail Haniyeh, prime minister of the Palestinian government dismissed by Abbas last weekend, called for renewed talks on Saturday between the factions, Haniyeh's office said.

Abbas has ruled out any dialogue with Hamas, whom he accused of trying to assassinate him and of launching a coup in the Gaza Strip.

Hamas has denied Abbas's allegations and accused him of participating in a U.S.-led plot against its democratically-elected government.

"The way out of the current situation is launching a Palestinian dialogue without pre-conditions," Haniyeh told the Yemeni president by phone.

Haniyeh said these talks should be held "on the basis of no loser and no winner, and on the basis of no harm to anyone, and on the basis of a national unity government," according to Haniyeh's office.

Just over a week ago Hamas violently seized control over the Gaza Strip prompting Abbas to declare a state of emergency, dismiss Haniyeh from his post and establish an emergency government.

Earlier Friday, Hamas spokesman Salah Bardawil denounced the summit planned for Monday between Prime Minister Ehud Olmert and Abbas, saying Abbas would not be able to wipe out Hamas' sovereignty.

"Hamas will not back down in its efforts to establish a Palestinian state in the West Bank and the Gaza Strip on the 1967 borders ... with Jerusalem as its capital," Bardawil said.

Commenting on the summit, due to take place in Egypt, National Infrastructure Minister Benjamin Ben-Eliezer said it was too soon to discuss a revival of peace negotiations for a Palestinian state last convened in 2001.

"I don't even dream of seeing a peace process very soon," Ben-Eliezer told Army Radio. "I only dream about seeing some quiet."

The cabinet minister seemed to support arming Abbas better. "The real nuclear bomb is there and not in Iran," he said, referring to the threat of continued Hamas control over Gaza.

Meretz MK Ran Cohen said weapons alone would not ensure Abbas's political survival in the West Bank.

"Unless [Abbas] comes up with a political solution for the Palestinian people, the extremists will defeat him in the end," Cohen said, alluding to Hamas.

Palestinian official Saeb Erekat said in anticipation of the talks it was "most important we revive a meaningful peace process" that leads to a two-state solution to the Israeli-Palestinian conflict.

Lieberman slams plan to free PA tax funds as gesture to AbbasMinister of Strategic Affairs Avigdor Lieberman (Yisrael Beiteinu) on Friday slammed the government's plan to release Palestinian tax funds as a gesture to Abbas ahead of a summit in Egypt on Monday.

Past experience shows that supplying Fatah with weapons and funds has increased terror rather than stifling it, Lieberman told Israel Radio.

He added that Abbas has "no aptitude and stands no chance" of defeating the rival Hamas movement, which recently seized the Gaza Strip after violent clashes with Abbas' Fatah.

Prime Minister Ehud Olmert will offer the package to Abbas on Monday at their meeting in Sharm el-Sheikh, which will also be attended by Egyptian President Hosni Mubarak and Jordan's King Abdullah II. The summit is meant to show support for Abbas and the emergency government he formed in the West Bank this week.

At Sunday's weekly cabinet meeting, Olmert will ask the ministers to approve a decision to resume talks with Abbas' government, headed by Salam Fayad. Israel suspended contact with the PA government when Hamas won the Palestinian parliamentary elections 18 months ago. Resuming ties will be dependent on the Fayad government's accepting the conditions posed by the Quartet of Middle East peacemakers - recognizing Israel, disavowing violence and honoring previous agreements.

Ahead of Sunday's cabinet session, Olmert will meet with Defense Minister Ehud Barak and Foreign Minister Tzipi Livni to finalize the proposed concessions to Abbas. He will also hold consultations with the army top brass.

The proposed "package of gestures" will center on releasing tax monies that Israel collected on the PA's behalf but withheld after Hamas's election. It remains unclear which part of the $600 million in question will be transferred to Palestinian coffers. The cabinet will be asked to approve the release in principle, leaving the practical details for later.

A government source in Jerusalem said Thursday that more concessions will be offered, but that a prisoner release is not on the agenda.

Defense establishment officials said that several steps "tolerable from Israel's standpoint" could be taken to ease the Palestinians' daily lives. Among the potential concessions under discussion are removing some of the checkpoints in the West Bank to increase Palestinians' freedom of movement; encouraging investors - primarily from the Arab world - to build industrial plants in the West Bank; stopping the hunt for Fatah operatives in the West Bank; and agreeing in principle to let the Americans supply arms to the PA.

The last two matters were raised earlier this week at a meeting among the head of the Civil Administration in the territories, Brigadier General Yoav Mordechai; the commander of the Judea and Samaria Division, Brigadier General Yair Golan; and the PA's chiefs of national security and intelligence. One of Abbas's advisers also attended.

A defense official said Thursday that the army is leaning toward maintaining the current quantity of arms in the West Bank, which means allowing the replacement of worn-out weapons only. However, the possibility of permitting the Palestinians to operate armored personnel carriers will probably be up for discussion as well, he said.

Regarding the hunt for Fatah operatives, the official quoted Palestinian participants at the meeting as saying that if Israel desists, the PA will move to dismantle the armed militias and arrest terrorists.