TEL AVIV, Dec 4: Israeli Prime Minister Ariel Sharon proposed on Wednesday the creation of a Palestinian state in the zones under Palestinian administration, covering 40 percent of the West Bank and three-quarters of the Gaza Strip.

“Within the framework set by (US) President (George W.) Bush, Israel will accept the creation of a Palestinian state within non-definitive borders, which correspond to Zones A and B” under Palestinian administration, Sharon said on Israeli television.

It was the first time that the prime minister defined his vision of the extent of a future Palestinian state so clearly.

US CITIZEN ARRESTED: A US citizen suspected of links to the Al Qaeda network was arrested upon arrival in Israel last month, Prime Minister Ariel Sharon’s office said on Wednesday.

Khaled Nazem Diab, who held a US passport, “was arrested upon his arrival in Israel on suspicion of transferring funds to terrorist organizations, in general, and those connected to Al Qaeda, in particular,” a statement said.

The 34-year-old suspect is “known to have contacts with organizations and activists connected to Hamas”, it added.

Diab had worked recently for charities in Qatar and is a former employee of the Al-Najda charity, which was shut down in the United States after the Sept 11 attacks, the statement added.

Al-Najda’s founder Rabih Haddad is now behind bars there, it added.—AFP