OCCUPIED JERUSALEM, 16 April — Israeli forces yesterday arrested Marwan Barghouti, the West Bank chief of Yasser Arafat’s Fatah movement on a day when Prime Minister Ariel Sharon came up with a bizarre proposal of holding a peace conference following hectic shuttle diplomacy by US Secretary of State Colin Powell.

No sooner had Powell accepted Sharon’s new proposal of a US-hosted Middle East peace conference, the Israeli premier announced yesterday that Israeli forces would withdraw from two of the four West Bank cities they occupy, evoking a swift response from chief Palestinian negotiator Saeb Erekat, calling Sharon’s move a sham.

Sharon’s unilateral condition of holding the Middle East peace conference was that Palestinian President Yasser Arafat should not be involved, claiming that peace could never be achieved with Palestinian leader (Arafat).

It was later reported by a senior US official that Powell will see Sharon again today and meet with Arafat tomorrow.

Sharon, who had refused to tell Powell when he would end a 17-day-old military offensive, disclosed plans for a partial pullout just hours after soldiers arrested a senior leader of Arafat’s Fatah faction, the symbol of intifada.

Sharon said Israeli forces would leave Nablus and Jenin — where soldiers and gunmen had fought fierce battles — within a matter of days, but he gave no indication of when they would withdraw from Bethlehem and Ramallah.

Sharon’s announcement appeared to mark the first sign Israel was starting to pay attention to demands from Washington, its chief ally, but still fell far short of fulfilling US calls for an immediate and full withdrawal.

Powell earlier gave a boost to Sharon’s new proposal for a US-hosted Middle East peace conference, saying it could take place at ministerial level and not necessarily involve Arafat — a key Israeli condition.

“We’re on our way out,” Sharon told CNN a day after holding talks with Powell, who had pressed the Israeli leader to step up the army’s departure from Palestinian cities it invaded following a wave of bombings against Israelis.

Erekat, meanwhile, said Sharon was defying the United States and the international community by not withdrawing immediately from the West Bank as US President George W. Bush had demanded. “He’s playing with words,” Erekat told CNN. “He is turning our towns, villages and refugee camps into big prisons.”

Sharon said it would be impossible to reach a peace deal with Arafat, whom he accused of pursuing a strategy of “terror, terror and more terror”.

“With him, I personally think that we will not be able to reach any agreement. I believe there are others,” he said, but did not give any names.

Israel has repeatedly accused Arafat of involvement in what it calls a “terror infrastructure” and of failing to do enough to rein in militants — charges Arafat has denied.

Earlier yesterday, Israel arrested Marwan Barghouti, 42, a senior Palestinian leader it described as the head of “the most murderous group” in the West Bank.

Sharon promised to put Barghouti on trial soon, but Erekat said that would violate Israeli-Palestinian interim peace accords. Israeli special forces captured Barghouti, a main coordinator of the 18-month-old Palestinian uprising against occupation, in a raid on a house in the city of Ramallah.

Arafat aide Ahmed Abdul Rahman told Reuters: “Any harm to Barghouti will lead to grave consequences.”

Israeli forces involved in the West Bank offensive burst into a house in Ramallah and arrested Barghouti after others inside, including his nephew, Ahmed Barghouti, heeded the soldiers to come out and surrender, the army said.

Israel has accused Barghouti of leading Fatah-affiliated militants behind shooting ambushes and suicide bombings. Barghouti, a member of the Fatah revolutionary council and the Palestinian Legislative Council, has denied the allegations but maintained Palestinians have a right to resist Israeli occupation of the West Bank and Gaza Strip.

Barghouti, who spent several years in Israeli jails and speaks fluent Hebrew, said on Israeli television before the current West Bank campaign that Sharon would be responsible for dozens of Israeli deaths if Israel killed him.

Powell, who has been stymied so far in his efforts to broker an Israeli-Palestinian cease-fire, traveled from Israel to Lebanon and Syria in a bid to avert wider conflict. He called on them to rein in Lebanese Hezbollah fighters whose border attacks against Israel he said threatened to escalate into a regional conflict.

Powell visited Damascus yesterday to inform Syrian President Bashar Assad of US dismay at cross-border attacks by Hezbollah, and was told in turn there was no point in Syrian condemnation of Palestinian bombings. “Condemning those operations will have no effect on reality as millions of Arabs and Muslim support such operations,” Syria’s news agency SANA quoted Bashar telling the American. These bombings in Israel were a result, not a reason, for what was going on.

On arrival, Powell told reporters that he would also exchange views with Bashar on efforts to end the Israeli-Palestinian violence and “find a way forward to negotiations”.

According to SANA, Assad replied, “If it (the peace process) is not set right, matters may go up to the point of no return, and then we’ll have to wait for another generation (to make peace). It’s not possible to even talk about peace unless Israel pulls out from the Palestinian territories and stops its massacres.”

Earlier in Beirut, Lebanese officials rejected a warning from Powell that “aggressive actions” in southern Lebanon against Israel could lead to a wider Middle East conflict. The Lebanese speaker, Nabih Berri, refused to even meet the secretary of state, saying, “The resistance in southern Lebanon is not carrying out aggressive acts. It’s trying to liberate occupied Lebanese land.”

Lebanese President Emile Lahoud told Powell during a 45-minute meeting that Hezbollah attacks on Israeli troops in the Shebaa area were not terrorist acts but legitimate resistance against occupation, Lebanese officials said.

Earlier yesterday, Sharon floated his idea for a US-hosted regional peace conference at Sunday’s meeting and though Powell at first reserved judgment he showed signs of interest later. Powell said the conference idea was still at a preliminary stage, but he said there were “many willing sponsors”. When asked specifically about Arafat, he said: “...it does not necessarily require his personal presence to get started”.

“In fact one model one could consider is a ministerial level conference, not necessarily heads of state or government,” he told reporters on his plane, as he returned to Israel.

An Israeli political source said Israel would pursue the conference proposal only on condition Arafat be excluded. Sharon, who has tried to isolate Arafat by surrounding him with tanks at his Ramallah headquarters, sidestepped the question of Arafat’s involvement in the CNN interview. But he predicted the conference would take place within weeks.

Arafat said on Sunday he would support the convening of a conference if Bush backed it and it was accompanied by an Israeli withdrawal. Political analysts said the conference would be a non-starter without Arafat’s presence.

A senior Palestinian official said yesterday that Sharon’s proposal to hold a Middle East peace conference was “ridiculous” at a time when the West Bank remains under siege. “This proposal is ridiculous. Israel must withdraw from occupied territories and only then we can speak about negotiations, not today, under massacres,” said Farouk Kaddoumi, the PLO’s political department chief.

“Sharon kills Palestinians, destroys our houses, our schools, our infrastructure, he has committed massacres in (the West Bank towns of) Jenin and Nablus. He is a war criminal,” charged Kaddoumi.

Meanwhile, EU foreign ministers reacted with skepticism yesterday to Israel’s proposal for a Middle East peace conference under US auspices that would not necessarily include Europeans at the table.

As the Council of Ministers gathered in Luxembourg to debate the Israeli-Palestinian conflict over lunch, it appeared that the 15-nation bloc would not slap economic sanctions on Israel while US Secretary of State Colin Powell pursues his shuttle diplomacy.

Despite a call last Wednesday by the European Parliament for a suspension of the 1995 pact that governs the EU’s trade and political ties with Israel, it appeared yesterday that the foreign ministers would not impose sanctions.