Calling the latest resolution unbalanced, Israel said it would continue to besiege Arafat's crumbling offices in the West Bank town of Ramallah until about 20 wanted people among the 250 men pinned down inside surrendered.

Defense Minister Binyamin Ben Eliezer told Israeli public radio: "We respect the United Nations, but it must realize that we will only apply its resolution when the other side puts an end to terrorism.

"We have the duty to assure the security of our citizens, and that is a right that no one will deprive us of."

Arafat, meanwhile, issued an appeal for the international community to ensure Israel implements the UN Security Council resolution, saying the Palestinian Authority was respecting its part of the deal.

"The Palestinian National Authority is conforming fully with the resolution and calls for the international community to force Israel to withdraw and lift the siege," he said, quoted by the official Palestinian news agency WAFA.

Arafat said "the unanimity of the Security Council and the US abstention are proof of the isolation of Israel's policies."

Israel's defiance of the Security Council was all the more pronounced since its main backer Washington not only abstained from the 14-0 vote, instead of vetoing the resolution, but later made a blunt criticism of the siege.

US President George W. Bush said the five-day-old blockade, sparked by two suicide bombings last week, was "not helpful" for Palestinian political and security reforms, but stopped short of calling on Israel to withdraw.

In response, Arafat's adviser Nabil Abu Rudeina told AFP, "We welcome the statement of Mr. Bush and we consider it in keeping with Resolution 1435."

The resolution pointed the finger at both sides in demanding "the complete cessation of all acts of violence, including all acts of terror, provocation, incitement and destruction."

An Israeli official said the US reaction was to be expected, as Washington needed to obtain the largest support possible to deal with Iraq.

"Israel will continue the operation until its aims are achieved," the official said. "Either Arafat leaves his headquarters or the terrorists holed up there hand themselves over."

The Security Council said it was "gravely concerned at the reoccupation" of Arafat's headquarters" and demanded its immediate end.

Deputy US ambassador to the UN James Cunningham said he abstained because the resolution failed to explicitly condemn Palestinian suicide bombings, but did not say why he refrained from vetoing it.

The spectacular bulldozing of every building around Arafat's office, leaving the 73-year-old stranded in a few rooms, has prompted a barrage of international criticism.

The resolution also demanded "the expeditious withdrawal of the Israeli occupying forces from Palestinian cities towards the return to the positions held prior to September 2000", when the Palestinian uprising broke out.

Pope John Paul II added his weight to calls for lifting the Ramallah siege and "the suspension of all actions which compromise the already faint hopes for peace in the region".

British Prime Minister Tony Blair proposed a new international conference on the Middle East peace process, stressing the need for political reform of the Palestinian Authority and a security infrastructure to stop attacks on Israelis.

The row over the siege blew up as Israeli troops launched one of their biggest incursions yet in the hunt for suspected militants in the Gaza Strip, killing nine people, six of them civilians, according to Palestinian officials.

More than 80 armoured vehicles, backed by helicopters, stormed into Gaza City early Tuesday, sparking gun battles which lasted five hours.

The dead also included militants from the Islamist Hamas group and Al-Aqsa Martyrs Brigades, a radical armed offshoot of Arafat's mainstream Fatah movement, both responsible for killing dozens of Israelis.

The army reported no Israeli casualties and said it achieved its "triple objective": to destroy the home of a wanted militant and metal workshops which Israel suspects are being used to make rockets and mortars, and to "kill armed elements who opened fire" on its troops.

Around 30,000 people turned out for the funeral of the nine Palestinians killed, shouting for revenge against Israel and firing assault rifles in the air.

In Ramallah, Israeli troops late Tuesday fired shots into the air to break up a rally of around 200 Palestinians who headed toward Arafat's besieged compound.

A refrigerator truck was also seen entering and leaving the compound, apparently delivering food to those trapped inside, while a truck delivered what appeared to be a generator and eight spotlights.

(Xinhua News Agency September 25, 2002)