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With rising tensions undermining planned cease-fire talks, Israel’s Jews and Arabs worried Monday that the first suicide bombing by an Israeli Arab may have shattered delicate relations between the two peoples, with disastrous consequences for both.

The radical Hamas movement released a videotape Monday showing the Israeli Arab suspect, Mohammed Shaker Habashi, vowing to carry out Sunday’s deadly attack at a railway station in revenge for the killing of 13 Israeli Arabs in the first days of the Palestinian uprising last October.

In Habashi’s Upper Galilee hometown, one of his two wives and other relatives denied that the devout Muslim could have been the bomber. But they also said he had compared Israelis to “animals” and that he had a brother imprisoned for alleged connections with Hezbollah guerrillas from nearby Lebanon.

As Israelis buried the blast victims and worried that their Arab neighbors may become a long-feared “enemy within,” many Israeli Arab leaders condemned the bombing and said they worried that suspicions and discrimination against their people may increase.

“Maybe some Muslims expressed solidarity with the Palestinian people, but this doesn’t give any legitimacy to suicide bombings,” said Fawzi Mishlab, the Arab Druze mayor of Abu Snan. “If it’s true he was the bomber, then he is hurting the Arab Israelis even more than the Israelis.”

The fears and anger were one more obstacle to stepped-up efforts Monday to finalize a first round of cease-fire talks between Palestinian leader Yasser Arafat and Israeli Foreign Minister Shimon Peres.

Diplomats said the talks were tentatively scheduled for Tuesday.

The two sides said there was disagreement over whether to hold the talks in Israel or Egypt. Critics on each side also expressed doubts that the two leaders had a mandate from their angry constituents to make real progress in ending the violence.

“The country is not in the mood to negotiate,” said Peres, who has been trying to set up the meeting for weeks.

U.S. officials said they were working hard to facilitate the meeting.

Military reportedly deployed

In response to Sunday’s suicide attack, the Israeli army reportedly moved tanks, troops and bulldozers to the outskirts of the West Bank city of Jenin, where Prime Minister Ariel Sharon’s government alleges that Hamas recruited Habashi, 48, and outfitted him with the bomb.

In renewed violence Tuesday in the West Bank, two Israelis were killed in a Palestinian shooting attack near the town of Tulkarem, army radio reported.

For Israelis, the first suicide bombing by one of their country’s 1 million Arabs was a nightmare come true. The Israelis have long feared attacks by “an enemy within” because the two peoples live and work together.

Israel’s Arabs have been citizens since Israel became a state in 1948, while tens of thousands of their fellow Palestinians fled or were chased away. They have long complained about discrimination by Israel’s government, but their protests were mostly peaceful until last October.

During the first days of the Palestinian uprising, some Israeli Arab demonstrations turned violent, and Israeli police killed 13 protesters with rifle fire. The shootings are being investigated by a judicial commission.

In the videotape released Monday by Hamas, Habashi says he was avenging those and other deaths. He appeared seated with an assault rifle across his lap.

“I am the living sacrifice,” Habashi says on the tape.

In a leaflet distributed in Gaza, Hamas claimed it had recruited Habashi and that Sunday’s attack proved it could strike deep inside Israel despite the army’s blockades in the Palestinian territories.

While officials emphasized that the vast majority of Israeli Arabs remain peaceful citizens, experts said the escalating violence enveloping the Arabs’ Palestinian brethren in the West Bank and Gaza was certain to draw in more members of the Israeli Arab population.

In the Israeli parliament, right-wing lawmakers called for the outlawing of the Islamic Movement, an Israeli Arab organization that some Israelis accuse of stirring up anti-Israel sentiment with its radical sermons and newspapers.

Leaders of the Islamic Movement said that the real incitement of Israeli Arabs was in Israel’s actions, not Arab propaganda, and that their people have proved their loyalty to Israel for 53 years.

“The root of the problem is that Israel is waging war in the [Palestinian] territories and discriminating against Arabs in Israel,” said Abdelmalik Dahamshe, an Arab member of parliament.

Grief and disbelief

In Abu Snan, Habashi’s relatives gathered Monday in grief and disbelief at the family home behind the construction materials shop that the suspect owned with his sons.

The family described Habashi as an extremely devout person who often dressed in religious garb. One of his two wives, Wafaa Ismail, 37, said he occasionally would leave home for days, saying he was going out to preach Islam in nearby villages.

She said he would tell her, “I am leaving for the sake of God.”

Those were his last words 10 days ago when he disappeared from Abu Snan, the family said.

Soon after, Israeli troops raided the family’s home at night, looking for him. The family says it had no idea where he had gone before the Israelis said his identity card was found at the scene of the bombing Sunday.

Habashi was acutely aware of Israel’s alleged discrimination against Arabs.

Last year, he staged a long-shot and ultimately unsuccessful run to become Abu Snan’s mayor, with a campaign aimed at bringing “equality” to Muslims, according to his brother Jamal.

Although Abu Snan’s population is 53 percent Muslim, its leadership is dominated by the minority Arab Druze, many of whom serve in the Israeli military. Muslims say they also get preferential treatment from the Israelis.

The family says Habashi, the father of 10, was affected by the intifada bloodshed. He collected and distributed food for the Palestinians, and occasionally denounced the Israelis for mistreating the Palestinians.

“He used to say, `Only animals would do something like that,'” said Omar Habashi, 46, another brother.