Israel's defense minister on Sunday raised the specter of an Israeli invasion in the Gaza Strip, where Palestinian militants already face a deadly air campaign.

Friends of eight-year-old Palestinian girl Aaya Fayaad weep during her funeral at the Khan Younis refugee camp on August 31, 2003. Fayaad was killed by an Israeli tank shell while riding her bike near her home, Palestinian security sources and medics said.   [Reuters]

Israeli military commentators say a ground offensive in the densely populated Gaza Strip, home to more than one million people under Palestinian control, would cause heavy Israeli and Palestinian casualties.

"We always have the option of a ground operation in Gaza," Shaul Mofaz said. "We will exercise it when we decide it is right to do so, at the appropriate time."

Israel has killed 13 Palestinians, including 10 militants, in helicopter missiles strikes since a Hamas suicide bomber killed 21 people on an Israeli bus in Jerusalem on August 19.

Mofaz spoke to reporters hours after a Palestinian gunman shot and wounded an Israeli truck driver at the Jewish settlement of Rafiah Yam in the southern Gaza Strip, the latest violence to batter a U.S.-backed peace "road map."

The shooting, claimed by the militant Islamic group Hamas, followed an Israeli helicopter missile strike Saturday that killed Abdullah Aqel, leader of its armed wing in central Gaza, and another Hamas member.

Palestinian Information Minister Nabil Amr said the attack in the Bureij refugee camp destroyed any chance for the resumption of talks with Israel and called on the United States to intervene and halt the cycle of violence.

"Israel's continuation of such policy means that it is completely turning its back on...calm and the possibility of implementing the road map," Amr said about the plan that envisages creation of a Palestinian state by 2005.

In a separate Gaza incident, an eight-year-old Palestinian girl was killed by an Israeli tank shell in the city of Khan Younis Saturday, Palestinian security sources said.

The army said troops opened fire in the area after an explosive device blew up near a patrol, damaging a military vehicle. An army spokesman could not confirm anyone was hit.

SHARON SAYS WON'T TOLERATE ROCKET ATTACKS

Israeli security sources said that Aqel, 37, was behind recent rocket attacks on southern Israel from northern Gaza.

"Ashkelon will not become the frontline -- neither Ashkelon nor any other place," Israeli Prime Minister Ariel Sharon told reporters Sunday, referring to the southern city hit on Thursday by a makeshift Qassam rocket that caused no casualties or damage.

Islamic militants renounced a seven-week-old truce on August 21, shortly after Israel killed Hamas's second-ranking political leader, Ismail Abu Shanab, by attacking his car with a missile.

EU foreign policy chief Javier Solana said before meeting Israeli leaders Sunday he hoped the two sides would halt escalating violence and continue with the road map, which he called "the best document we have on the table now."

A power struggle between Palestinian President Yasser Arafat and Prime Minister Mahmoud Abbas is obstructing progress on the peace plan and Palestinian lawmakers said the problem would be tackled at a special parliamentary session Thursday.

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