Israel to Free 1,200 Arab Prisoners : Mideast: The move has nothing to do with Baker’s visit or U.S. demands, a spokesman says.

Hours before Secretary of State James A. Baker III arrived for his second visit in a month, the Defense Ministry announced Monday that 1,200 Palestinian prisoners will be freed.

But officials were coy about saying whether the release was meant to satisfy U.S. demands for Israeli efforts to ease tensions with the rebellious Arab population.

On his visit last month, Baker had pressed Israel to make confidence-building gestures toward Palestinians.

Danny Naveh, a spokesman for Defense Minister Moshe Arens, pointed out that the government routinely makes gestures, such as freeing prisoners, during Muslim festivals (the Islamic holy month of Ramadan is now under way). Naveh said Monday’s announcement had long been in the works and had nothing to do with Baker’s visit.

When asked if Israel expects a reciprocal gesture from Arab states, he responded, “Well, perhaps as a byproduct.”

Israeli officials are reluctant to give the impression that they may be acting under pressure from Washington, and that perhaps explains their hesitation to link the release to Baker’s visit.

The visit has been greeted with uneasiness by the government. Prime Minister Yitzhak Shamir tried to allay fears among members of his right-wing coalition that Baker will try to force Israel to make a pledge to trade occupied land in the West Bank and Gaza Strip for peace with Arab states and the Palestinians.

“If there are any pressures, we will face them,” Shamir said.

Several ministers urged steps to preempt any appeals for compromise by Baker. Housing Minister Ariel Sharon, an aggressive advocate of Israeli settlements in the occupied territories, suggested Sunday that the government annex the communities. On Monday, television showed him touring a new housing project that straddles Israel’s 1967 frontier with the West Bank, which Israel occupied during the Six-Day War.

Science Minister Yuval Neeman, a member of the expansionist Tehiya, or Rebirth, party, warned against giving in to Baker on the land issue. “We must worry about and safeguard our defense and security interest and not be tempted into various proposals that come from today’s so-called new atmosphere,” he said.

Baker is scheduled to meet today with Shamir, Arens and Foreign Minister David Levy.

According to state radio, the government will propose convening a onetime regional conference to get peace talks with Arabs off the ground. After an initial meeting, the conference would split into a series of bilateral talks between Israel and various Arab states and between Israel and a delegation from Jordan and the West Bank and Gaza.

Levy, the prime proponent of that idea, stipulated that the Palestinians who would take part could not belong to the Palestine Liberation Organization nor reside in East Jerusalem, whose Arab neighborhoods were seized by Israel in 1967 and later annexed.

In Israel’s view, a PLO role is taboo because that group demands a state alongside Israel and has used terror to forward its aims. The inclusion of Arabs from Jerusalem would, it is felt, undermine Israel’s hold on the eastern half of the city.

The government acted to head off any attempt by Baker to elicit a public acceptance of United Nations resolutions that call for withdrawal from the West Bank, Gaza and East Jerusalem. Officials assert that Israel complied with the resolutions years ago by pulling out of the Sinai Peninsula after signing a peace accord with Egypt in 1979.

In effect, by claiming compliance with U.N. resolutions and insisting that a regional conference quickly give way to bilateral talks, Israel’s proposal tries to achieve a longtime goal of gaining recognition from Arab states outside of the framework of land-for-peace.

The prisoners whose release was announced are held on charges of taking part in the Arab uprising in the occupied territories, now well into its fourth year. Israeli jails hold about 15,000 Palestinians--about half of them without trial. The release recalls a similar gesture made by Israel during Shamir’s first talks in Washington with President Bush two springs ago.

The Defense Ministry also announced a proposal to give tax breaks to Palestinian businesses to encourage investment in the disputed land. The ministry, which is responsible for governing the West Bank and Gaza, had been studying measures to create jobs for Palestinians who have been squeezed out of the Israeli labor market.

There appears to be no movement on a key request by the Bush Administration: that Israel stop expanding settlements in the West Bank and Gaza. Such a step, in Shamir’s view, would suggest that Israel is ready to give up the territory to the Palestinians. His government is commited to building settlements, and his right-wing coalition would probably break up rather than support such a step.

Since occupying the West Bank and Gaza in 1967, Israel has asserted title to about half of the land through expropriations. More than 1.7 million Palestinians live in the territories; about 90,000 Israelis reside in settlements.

As he did last month, Baker invited a group of Palestinians to meet him today. The delegation’s makeup appears to undercut Israel’s efforts to exclude East Jerusalem Arabs. The group will again be headed by Faisal Husseini, who is linked to the PLO and lives within sight of Jerusalem’s Old City.

Palestinian delegates describe themselves as PLO envoys and view Baker’s willingness to meet with them as a fig leaf for PLO involvement in the talks. “The Americans would prefer Palestinian negotiators from the occupied territories who are supported by the PLO but not PLO members,” said Hanan Ashrawi, a Palestinian educator who met with Baker during his last visit here and with State Department officials during a recent trip to Washington.

Husseini told reporters he plans to ask Baker about continued expansion of settlements as well as new land expropriations. The Bush Administration has described the settlement program as an obstacle to peace but has done nothing concrete to try to halt it.

The Palestinian team is expected to be smaller than that of last month, when 10 people showed up; factional disputes and criticism from leaders of the uprising have taken a toll on the numbers, Palestinian observers say.

Jerusalem was closed to Palestinians from the West Bank and Gaza in anticipation of Baker’s arrival. On the eve of his last visit, a Palestinian stabbed four Israeli women to death in Jerusalem.