JERUSALEM, 4 May 2004 — Israeli Prime Minister Ariel Sharon was considering a modified “disengagement” plan yesterday after his Likud party routed his Gaza pullout plan and caused his most stinging defeat since he took office in 2001.

“All those who think that the Likud leadership will stop its efforts to settle the conflict are wrong. I intend to present a plan including some amendments,” Sharon told Likud deputies.

On Sunday, Likud members overwhelmingly voted down the plan for a troop withdrawal from most of the Gaza Strip and the removal of all 21 Jewish settlements in the Palestinian territory.

The premier survived a no-confidence vote in Parliament that was submitted by left-wing and Arab parties a day after his crushing 20 percentage-point defeat in an internal referendum threatened to precipitate a major political upheaval in Israel.

Addressing his party ahead of the opening of the Parliament’s summer session yesterday, Sharon repeated a statement he issued the previous night in which he warned “difficult decisions” would have to be made.

He did not elaborate on his strategy or on the changes he might make to his controversial plan.

“I intend to continue leading the state of Israel to the best of my understanding, conscience and public duty. This is not an easy task, however I intend to carry it through,” he said in a statement Sunday.

Opposition Labour Party chief Shimon Peres was swift to call for the Knesset to be dissolved and early parliamentary elections to be organized.

“Whether he wants it or not, Sharon has not been granted a mandate by his party, and the nation should have the right to express itself on the issue. We propose dissolving the Knesset and holding elections,” Peres told his supporters.

Sharon’s defeat in the Likud referendum was also an embarrassment for US President George W. Bush, who put his credibility on the line by lending full support to the plan.

The Israeli press was aghast following the landslide victory of the plan’s opponents, who led a more aggressive campaign which was largely organized by the settlers themselves.

The Haaretz daily described the result of the referendum as “humiliating” for Sharon, but as all observers agreed that the thick-skinned premier would not resign, Israeli newspapers stressed he would have to show strong leadership ability.

Aware that Sharon was showing no sign of renouncing his plan, settlers maintained a tough stance on the ground, as four Jewish families moved into flats in a West Bank suburb of annexed East Jerusalem.

And in the Gaza Strip settlement of Neve Dekalim, defiant settlers laid the cornerstone for a new neighborhood, settler sources said.