Palestinian leader Yasser Arafat is confined by Israel to the tiny self-rule enclave of Ramallah. Yet he makes Palestinian statehood sound like it is just around the corner, declaring 2002 "the year of independence and liberty."

The gap between Mr. Arafat's rhetoric and the reality of heightened fragmentation in the West Bank and Gaza Strip territory earmarked for the state has never been wider, say both Israeli and Palestinian analysts. Pointing this up, Prime Minister Ariel Sharon again banned Arafat from leaving Ramallah for Bethlehem, this time to mark yesterday's Orthodox Christmas celebrations, on the grounds that the Palestinian Authority has not arrested alleged assassins of Israeli Tourism Minister Rehavam Zeevi.

And Israel's seizure Thursday of a major arms shipment it says was headed for the Palestinian Authority has further stalled de- escalation toward a significant easing of restrictions.

Troubles in moving around, though new for Arafat, have become all too familiar to Palestinian civilians and civil servants.

As Jewish settlements break up the contiguity of Palestinian areas - in some cases even expanding - there is stepped-up construction of bypass roads. The roads, built after the 1993 Oslo Agreement to enable settlers to skirt Palestinian Authority areas, separate villages.

Dozens of new checkpoints

And no less of a challenge for statehood is that dozens of new Israeli army checkpoints have been established in the West Bank and Gaza Strip, in moves the army says are aimed at thwarting attacks on Israelis.

While Israel announced last week that it is removing some of the barriers, Palestinians say no real change has been made and that the announcements are a show to impress visiting US envoy Anthony Zinni. "I don't see that it has made a real difference on the ground," says Bassem Eid, director of the Palestinian Human Rights Monitoring Group.

A leading Israeli analyst of Palestinian affairs predicts that many of the new checkpoints will become permanent. "The Palestinians might be on the way to establishing the first virtual state," says Hillel Frisch of the Besa Center for Strategic Studies at Bar Ilan University. "Virtual statehood" would include governing institutions and international recognition, but it would lack territorial contiguity, he says. "The Palestinians have lost the basic trust of the Israelis, so the Israelis will do everything possible to remote- control the state. Israel will want to slice the state up, to keep the checkpoints."

According to Didi Remez, spokesman of the dovish Peace Now group, which opposes settlement construction, an "extremely significant" number of bypass and military roads have been created since the start of the uprising on land seized from Palestinians. A new map issued by the PA's Palestinian Geographic Center, shows 78 new checkpoints.

Jacob Dallal, an army spokes-man, says the checkpoints are essential "to prevent people seeking to carry out terrorist attacks from entering Israel and from moving around" within the West Bank and Gaza Strip. As soon as the Palestinian Authority makes a greater effort to thwart attacks, checkpoints will be lifted, he says.

Palestinians say checkpoints are often in areas well-removed from Israelis and amount to collective punishments. They believe the real purpose is to increase pressure on the civilian population. …