France and the European Union were ready to help achieve that end, he said.

Olmert, who is on his first visit to Europe since his election in March, is trying to sell a plan to set Israel's borders with or without agreement
from the Palestinians if he is unable to restart negotiations.

Though France has repeatedly said it would oppose any unilateral settlement, Olmert said Monday he would seek to convince Chirac to become a "partner" in his plan.

In a brief statement before their meeting, Olmert vowed to make "all the efforts" necessary for talks to resume with the Palestinians.

But he repeated Israel's three pre-conditions: "an end to terrorism, the respect of all agreements between the Palestinian Authority and Israel, and the recognition of Israel".

The three principles have been rejected by the government led by Hamas, the main Islamist movement in the Palestinian territories, effectively paralysing the peace process.

Tensions escalated further between Israel and the Palestinians last week following the death of eight Palestinian civilians in an explosion on a beach in the northern Gaza Strip -- which prompted Hamas to end an 18-month truce.

Designed to prevent a "stalemate" if it proves impossible to resume talks, Olmert's so-called "realignment plan" would see Israel uproot 70,000 settlers from the West Bank while cementing its hold on housing blocs where most of the quarter of a million settlers live.

US President George W. Bush has called the plan "bold" but has also told Olmert that he must first exhaust all efforts to reach an agreement with Palestinian leader Mahmud Abbas.

The Israeli prime minister suggested following his talks in London Monday that his British counterpart Tony Blair had also tacitly backed his proposal, which has received a cool reception from some Arab leaders.

Blair said he favoured a negotiated settlement, but accepted that talks could only resume if Israel's conditions were met -- and that Israel would seek otherwise to "unlock" the situation.

Olmert and Chirac were also expected to discuss the resumption of hundreds of millions of dollars of Western aid to the Palestinians -- suspended as part an economic boycott over the refusal by Hamas to recognise Israel.

The suspension of aid has brought the hard-up Palestinian Authority to the brink of bankruptcy and is thought to have fuelled an unprecedented upsurge in deadly factional violence in the Palestinian territories.

Chirac has called for a solution to be found "quickly" to channel funds to the Palestinian Authority, bypassing Hamas, to pay civil servants' salaries -- but Israel is against the payment of anything other than humanitarian aid.

Following his talks with Chirac, Olmert was to meet Prime Minister Dominique de Villepin and Foreign Minister Philippe Douste-Blazy.

He was also set to inaugurate a monument to French nationals who helped Jews escape capture by the occupying Nazi forces during World War II.

Prosecutors at the six-week trial which ended last month said that in December 2002 the group was close to attacking targets including the Eiffel Tower, the Les Halles shopping centre, police stations, and Israeli interests.

Ten year sentences were given to Merouane
Benhamed, 33, who was described in court as the group's chief, and to Menad Benchellali, 32. Said Arif, 40, who was extradited from Syria to stand trial, and Nourredine Merabet, described as the group's financier, were sentenced to nine years.

Lesser punishments including suspended jail sentences were handed down on other group-members who were found to have played only a small role in the plot. All were charged with "criminal association in relation with a terrorist enterprise."

Benhamed's lawyer Isabelle Coutant-Peyre denounced the verdict, saying the defendants were "convicted because they are Muslims. This serves the interests of the US, Algeria and Russia. France has the job of convicting Muslims who are a problem to these powers."

During the trial several defendants accused investigators of mistreatment and of offering inducements to confess.

Prosecutors said the group operated out of a flat in the Paris suburb of Romainville, where they gathered funds from the proceeds of petty crime.

The court was told that at the end of 2002 "they were ready to act". However police then made a series of arrests, confiscating electronic devices and chemicals that can be used for bomb-making.

Among those convicted Wednesday was Chelali Benchellali, the imam of a mosque in the southeastern city of Lyon and father of Menad.

Another of his sons, Mourad Benchellali, was one of seven French detainees held at the US base at Guantanamo Bay. Released in July 2004, Mourad now faces terrorist-related charges in France along with five others.

Investigators originally uncovered the Paris plot while looking into alleged recruitment networks to send young men to fight the Russians in Chechnya. Initial reports after the first arrests suggested the plotters were planning chemical attacks against Russian targets in France.

The sentences handed down Wednesday were in many cases much less severe than those requested by the prosecution.

The official said Zahar had declared the money at the border, which is controlled by President Mahmoud Abbas' presidential guard and monitored by European observers. It was not immediately clear whether Zahar would be permitted to keep the money.

Last month, a Hamas official was caught as he tried to smuggle about $800,000 into Gaza. The money was seized, but later returned to the government. Normal travelers must declare all sums over $2,000 and explain their origin.

Abbas has been in a power dispute with the Hamas-led government, and his presidential guard must make the final decision about what to do with the money.

A cutoff in Western aid has left the Hamas-led Palestinian government broke and unable to pay salaries to tens of thousands of civil servants for three months. The money carried by Zahar would cover only a small portion of the government's mounting debts.

Israel and Western donors have demanded that Hamas renounce violence and recognize Israel's right to exist as a condition for restoring the aid. Hamas, which is sworn to Israel's destruction, has rejected the calls and instead turned to Arab and Muslim countries for help.

The source of Zahar's money wasn't immediately known. During his recent trip, Zahar traveled to Indonesia, Malaysia, Brunei, China, Pakistan, Iran and Egypt.

Hamas has said it has raised more than $60 million, but previously has been unable to transfer the money to the Palestinian areas because banks are afraid of running afoul of U.S. anti-terrorism laws.

The U.S., European Union and Israel consider Hamas a terrorist group.

It was not clear how the explosive got there, or whether it might have been an unexploded Israeli shell from an earlier military barrage. Peretz did not address that issue in his remarks. Israel has been claiming that Hamas militants planted a device to set off against Israeli commandos.

"We have enough findings to back up the suspicion that the intention to describe this as an Israeli event is simply not correct," Peretz said at a Tel Aviv news conference on the inquiry's findings. "The accumulating evidence proves that this incident was not due to Israeli forces."

Palestinians angrily rejected the findings, saying militants were unlikely to plant bombs at a beach teeming with hundreds of people every weekend.

The bloody images of dead Palestinian civilians and wailing survivors on the beach kindled anger against Israel that has swept around the world.

The seaside carnage contributed to a sudden spike in Israeli-Palestinian violence. After the beach blast - and Israeli forces' killing of a top Gaza militant - Hamas called off a 16-month cease-fire that had significantly reduced casualties on both sides.

Human Rights Watch military expert Marc Garlasco, the first independent analyst to inspect the scene, said he examined the shrapnel on the beach, saw the civilians' injuries and concluded the blast was caused by an Israeli shell. He held open the slim possibility that it was planted there by Palestinian militants, although fragment patterns did not back that.

"Our information certainly supports, I believe, an Israeli shell did come in," he said, ruling out a land mine.

According to Israeli findings, shrapnel taken from two wounded Palestinians who were evacuated to Israeli hospitals showed that the fragments were not from the 155-millimeter shells used by Israeli artillery.

Showing aerial photographs and film, the head of the Israeli inquiry, Maj. Gen. Meir Klifi, declared: "There is no chance that a shell hit this area. Absolutely no chance."

Israel has been pounding northern Gaza with hundreds of artillery shells for weeks, trying unsuccessfully to stop Palestinian militants from setting up and launching homemade rockets at Israel.

In recent days, Israeli commando forces have entered Gaza to ambush rocket squads.

Palestinians rejected the possibility that their own explosives caused the fatal blast.

"This is a false allegation, and the Israeli occupation state is trying to escape from shouldering its responsibility by accusing Palestinians without evidence or any proof," said Ghazi Hamad, a spokesman for the Hamas-led Palestinian government.

"The eyewitnesses and the evidence that we have confirm that the massacre is the result of Israeli shelling, and the allegation about land mines planted by Palestinians is baseless," he said.

Palestinian lawmaker Saeb Erekat, who is close to President Mahmoud Abbas, a Hamas rival, called for an international inquiry. He complained that Israel was trying to blame the Palestinians and warned, "this means that this crime could re-occur."

Klifi said the explosion took place between 4:47 p.m. and 5:10 p.m., and no Israeli shells were fired then.

The blast occurred on the outskirts of the town of Beit Lahiya, not far from where Palestinian militants frequently fire rockets toward Israel. The shore is frequented by hundreds of Palestinian beachgoers on Fridays, a rest day in Gaza.

The army has accounted for five of six of the shells that it fired in the area Friday evening before the beach explosion, Klifi said. None of them exploded nearby. The one shell that is not accounted for was fired before the five others - more than 10 minutes before the blast that killed the Palestinians, he said.

"The possibility that a person responsible for such a terrible crime could go free after serving a light sentence...is cause for concern," said a spokesman for the U.S. embassy in Jakarta.

Terrorism experts and Indonesian security officials warn against overstating his importance. While he may once have been the active leader of JI, there have been signs in recent years, they say, that hardliners within the organization no longer either trust or revere him.

Indonesian officials also say further western pressure could hurt rather than help the fight against terrorism, especially as the war in Iraq plods on. The "exaggerated attention" given to Bashir internationally only elevated his status with the Indonesian public, said one senior security official Tuesday.

Bashir has never been accused of planning or executing terrorist attacks in Indonesia. But he has in recent years been a high-profile weather vane for the direction of the fight against terrorism in the world's largest Islamic nation.

Before the 2002 Bali attack -- at a time when the U.S. and others accused Jakarta of ignoring the JI threat -- Bashir was feted by prominent Indonesian political leaders.

Bashir was arrested just weeks after the bombings, amid an escalating crackdown on JI.

During Bashir's time in prison JI members have staged three other high-profile attacks -- on Jakarta's JW Marriott Hotel in 2003, on the Australian embassy in 2004 and on restaurants in Bali last October. Indonesia has established a strong record for arresting and prosecuting terrorists, with more than 100 JI members now behind bars.