Israel on Tuesday stood by its new policy of firing artillery shells at rocket squads operating from populated areas in Gaza, even after a round killed an 8-year-old Palestinian girl.

The military intensified its offensive against Palestinian rocket fire after the Islamic militant group Hamas took charge of the Palestinian Authority two weeks ago.

In a major policy shift, it has begun allowing guns to fire close enough to hit populated areas. That change claimed the life of Hadil Ghaben, 8, on Monday, after two shells blew huge holes in a concrete block house in Beit Lahiya in the northern Gaza Strip. The girl's mother and seven siblings were hurt in the attack.

"As long as it's not quiet here [in Israel], it won't be quiet there [in Gaza]," Israeli Defense Minister Shaul Mofaz said Tuesday.

Deputy Defense Minister Zeev Boim apologized for the girl's death, but said the military operations would go on as long as Palestinian militants continued to launch rockets at Israel.

"We are very sorry about it, but you have to understand that the military's task is to defend the security of the citizens of Israel," Boim said. "If the Hamas government will not control these terrorists from firing Qassam [rockets] against Israeli civilians in cities and communities, we will continue to push these citizens out of the range of these rockets."

Since the beginning of the month, Israel has retaliated against an estimated 32 rockets that landed in its territory with 16 airstrikes and more than 1,000 artillery rounds, the military said. Since Friday, 17 Palestinians, including 13 militants, have died in the offensive. There have been no Israeli casualties from the rocket fire.

Palestinian militants have threatened revenge for the Israeli military crackdown, but the Hamas government is quietly urging them to refrain from launching rockets at Israel without permission, officials from both sides have confirmed.

While Hamas says it still supports armed resistance against Israel, a halt in violence would enable it to focus on other crises.

Hamas won Palestinian legislative elections in January on a platform of ending government corruption and improving public services. But since being sworn into office, the government has found itself facing tough Western aid cutoffs, Palestinian infighting and now, growing violence with Israel.

Six Hamas legislators headed to a conference in Iran on Tuesday, hoping to drum up financial support from Islamic and Arab nations, said Mushir al-Masri, the head of the Hamas faction in parliament.

The money is desperately needed now that the U.S. and European Union have cut off tens of millions of dollars in annual aid, and Israel has stopped transferring roughly $55 million in monthly taxes it collects on behalf of the Palestinian Authority.

Palestinian President Mahmoud Abbas, a moderate whose Fatah Party lost to Hamas in recent legislative elections, said the aid cutoff is devastating the Palestinian areas.

"The situation is deteriorating in a dramatic and tragic way," he said. He said aid money "does not go to the government. It goes to the Palestinian people and human services."

Hamas has acknowledged the Palestinian Authority is broke and will have trouble paying the salaries of 140,000 government employees. Arab countries have promised to help, but have so far not kept their pledges.

Farhat Assad, a Hamas leader in the West Bank, said the group is encouraging protests in Arab and Muslim countries to help raise money.

"In the coming couple of weeks, the world will see demonstrations all over the Arab and Islamic states to pressure the governments to open their treasuries to the Palestinian people," he said.

Despite the EU ban on contacts with Hamas, which it considers a terrorist group, a European Parliament delegation visiting the West Bank town of Ramallah held talks with the Palestinian parliament speaker, Abdel Aziz Duaik, and other Hamas members.

"We came here because we wanted to make sure that we don't make any discrimination" against the Palestinian parliament, said Luisa Morgantini, chairman of the European Parliament's development committee.

Meanwhile, Israeli leader Ehud Olmert was proceeding with plans for a large-scale pullback in the West Bank. The pullout would follow Israel's unilateral withdrawal from the Gaza Strip last summer.

Olmert plans to draw Israel's borders unilaterally in the absence of a negotiating partner, and does not consider the current Palestinian leadership a partner as long as Hamas does not renounce armed struggle against Israel.

On Tuesday, the Israeli Cabinet adopted a ban on contacts with the Hamas-run government and said Israel will boycott foreign diplomats who meet with Palestinian Cabinet ministers.

Olmert, who became Israel's leader on Jan. 4 after Ariel Sharon suffered a devastating stroke, is expected to form his new government in the coming weeks. On Tuesday, the Israeli Cabinet declared the comatose Sharon to be permanently incapacitated, marking the official end of his five-year tenure.