JERUSALEM, Jan 19: The Israeli security cabinet gave the green light on Wednesday for military commanders to prepare for a large-scale invasion of the Gaza Strip if Palestinian attacks do not stop, public radio said.

The unanimous decision of Prime Minister Ariel Sharon's inner circle of ministers was made during their first meeting since the installation of a new coalition government last week.

New Palestinian leader Mahmoud Abbas is currently in the Gaza Strip for talks aimed at securing a cease fire by militant groups. But Israel has warned that it would give him only a limited amount of time to secure results before taking matters into its own hands.

A political source said Mr Sharon had also decided to lift a ban on contacts with the Palestinians following Mahmoud Abbass orders to Gaza security forces to halt attacks on Israelis within days.

The source said Mr Sharon opted to restore communication with the Palestinians after his cabinet received information from intelligence sources that Hamas (militants) were starting to cooperate with the Palestinian Authority. But Mr Sharon's office said contacts would involve only security officials for now and there would be none with Mr Abbas himself on diplomatic issues until after "Palestinians take real steps to stop terrorist operations and rocket and mortar fire".

The decision by Mr Sharon's inner cabinet meant that senior Israeli and Palestinian security officials would meet at Palestinian request to discuss coordination in reining in Gaza attacks, his office said.

Political sources said heavy Israeli military action in Gaza previously threatened was not now foreseen, but the cabinet did approve a future offensive if attacks did not subside soon.

Mr Sharon had phoned Mr Abbas to congratulate him on his election and hold out the prospect of what would be the first summit meeting between the sides in years. But Mr Sharon slammed the door a week ago after militants killed six Israelis in a Gaza border ambush.

Palestinian militant chiefs in Gaza said earlier on Wednesday they were discussing with Mr Abbas his demand for a cease fire but sporadic violence continued on the ground.

Israeli troops shot dead two militants near Gaza's fenced border, a rocket wounded two soldiers near Erez crossing and two mortar bombs crashed into a Jewish settlement, injuring no one.

A Hamas suicide bombing that killed an Israeli security agent at a Gaza checkpoint on Tuesday was a potent reminder of the obstacles Mr Abbas faces in inducing quiet so he can negotiate for a Palestinian state in the occupied West Bank and Gaza. He is caught between the militants and Israeli demands for an end to attacks as a condition for peace negotiations. -Reuters