Small Numbers of Palestinians Return to Jobs in Israel Israeli Move to Ease Tight Curfew Is Prompted by Concerns over Economic Losses

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AMID fears of possible intercommunal violence, Israel took small hesitant steps Sunday toward easing one of the longest and strictest curfews ever imposed on the occupied West Bank and Gaza Strip.

For the first time since the curfew began almost four weeks ago, several hundred Palestinian workers returned to jobs in Israel.

Human rights and development organizations have complained that the curfew has led to severe hardship in the Israeli-occupied territories, particularly for the families of 120,000 Palestinians who depend on jobs in Israel.

Pressure has also apparently come from a more unlikely quarter - hard-liners Ariel Sharon and Rafael Eitan, ministers of housing and agriculture, respectively. Both were last week said to be pressing for essential Arab workers to be allowed back into Israel: to build the houses urgently needed for new immigrants and to pick flowers and citrus fruit, two key agricultural exports. Some farmers have complained that fruit is spoiling on the trees.

Economists have warned of major losses in both sectors if the ban on Arab workers continues.

However, the return of Palestinians across the "green line" that marks the boundary between Israel and the territories it occupied in 1967 has not been universally accepted.

Geula Cohen, the deputy minister of science and energy, said the curfews imposed by the military government should be extended, not relaxed. She said fear of Iraqi Scud missiles - renewed by another attack early Saturday, which injured 26 people - should not be augmented by fear of being attacked by Palestinians.

According to Israel Radio, Ms. Cohen said it was preferable for Arabs to be "shut away in the territories," rather than have them "murdering Jews."

Last week saw the first Palestinian attacks on Jews since the start of the war. An Israeli soldier was stabbed at a bus stop in Galilee, while a security guard in East Jerusalem was set upon by ax-wielding Palestinians. Neither attack resulted in serious injury, but they carried echoes of last year's spate of similar attacks, in which eight Israelis died.

With Operation Desert Storm still raging, there are fears that Palestinian support for Iraqi leader Saddam Hussein might trigger a similar round of violence.

But Samir Hulaileh, a West Bank economist, says the war makes an explosion of Palestinian violence less likely. "People now feel they don't have any interest in escalating the intifadah (uprising)," he says, "in particular in these days and months of war. …