The bodies of two more Palestinian children were yesterday pulled from the rubble of a Gaza City neighbourhood hit in an Israeli air strike, raising the death toll to 17, as an initial Israeli military investigation showed that analysts had misread aerial photographs of the target zone and should have realised the likely civilian casualties.
The raid overnight on Monday killed the Hamas military commander, Salah Shehade, his wife, his daughter and a deputy, as well as 13 other Palestinians, most of them children, who were sleeping in adjacent homes.
The UN Security Council was last night to hold an emergency session to debate the raid, after a UN official visited the site and expressed horror at the "terrible incident". Israeli television reported last night that aerial photographs taken prior to the attack should have alerted military planners to the presence of Palestinian families in the nearby homes, some of which were makeshift structures. Israeli military officials acknowledged a grave "intelligence failure".
Israel's Foreign Minister, Mr Shimon Peres, said earlier that the attack would not have gone ahead if the civilian casualties had been anticipated. "It wasn't done intentionally," he said. "All of us feel sorry for the loss of life of innocent people, particularly children."
In an effort at damage-limitation, the Israeli government announced it was issuing 4,000 more permits for Palestinians to work in Israel, shortening the curfews it has been maintaining in Palestinian cities for the past month and transferring $45 million in tax revenues - 10 per cent of the funds it has been withholding from the Palestinian Authority.
Moreover, Mr Peres said Israel was still prepared to begin withdrawing its troops from West Bank cities if it could be confident that Palestinian security forces would adequately fill the vacuum.
It is not clear when or even if Palestinian and Israeli ministers will resume the talks on a possible return to security co-operation and modalities for an Israeli military pullback. The PA's Interior Minister, Mr Abdel-Razak Yehiyeh, who is responsible for the PA security forces, published a detailed plan yesterday, calling for Israel to withdraw its forces to their positions before the start of the Intifada.
The plan also pledged a subsequent PA effort to confiscate illegal weaponry and confront Palestinian factions which have been carrying out suicide bombings and other attacks on Israeli targets.
The PA's Information Minister, Mr Yasser Abed-Rabbo, said the Gaza attack had shattered a fragile "understanding" on a ceasefire negotiated with Hamas, Islamic Jihad and other factions including the Fatah Tanzim militia, which is loyal to the PA president, Mr Yasser Arafat.
While this claim was derided by some Israeli officials, it was plainly taken seriously by the EU's foreign policy chief, Mr Javier Solana, who on Tuesday bewailed the passing of what he saw as a genuine opportunity for progress.
The purported text of a planned ceasefire statement from the Tanzim, released by European sources, announced that "from this moment on, we will cease all attacks on innocent men, women and children who are non-combatants and we will take part in a national dialogue to convince our people of the rightness of this plan".
The Hamas leader, Sheikh Ahmed Yassin, yesterday ruled out any truce, declaring that there would be "100 new Salah Shehades" and predicting a wave of attacks that would kill hundreds of Israelis.
Some left-wing Israeli politicians and several Israeli media commentators echoed Palestinian and other Arab assertions that the strike had been deliberately timed by Mr Sharon to rupture the ceasefire effort. Aides to Mr Sharon and to the Israeli Defence Minister, Mr Benjamin Ben-Eliezer said army chiefs said it was "highly likely" that only Shehade and an aide were in the targeted building, that only a heavy bomb could be guaranteed to kill him and that there was little likelihood of civilian casualties.
Voicing uncharacteristic criticism of his government, Israel's president, Mr Moshe Katsav, said the political echelon had to take responsibility for the "mishap".
Despite regret over the civilian deaths, the raid is not fuelling wide debate in Israel about the efficacies of the policy of targeted strikes.