Israel today ruled out self-determination for the Palestinians and said that Egypt had expressed willingness to sign separate peace if other Arab states should refuse to go along.

Prime minister Menahem Begin, seaking after receiving a brief report from President Carter on his talks with Egyptian President Anwar Sadat in Aswan today, said:

"There cannot be any self-determination as this term is understood under international law and practice for the problem of the Palestinian Arabs."

"The term 'self-determination' means a Palestinian state and we will not agree to such a mortal danger to Israel," Begin said. He brandished the specter of a Soviet takeover of an "Arafatian Palestinian state in a matter of days or at most weeks," citing the experience of Soviet penetration in Angola, Mozambique, Ethiopia, South Yemen, Libya and "even Malta."

This view, that the present leadership of the Palestine Liberation Organization is terrorist, flies in the face of Sadat's insistence to Begin that PLO chief Yasser Arafat is a moderate and that Israel is making a major mistake not to deal with him.

Recently, however, Sadat has been softpedalling the idea of a Palestinian state that would be separate from neighboring Jordan. Begin expressed satisfaction that neither President Sadat nor President Carter referred to a Palestinian state in their public statements at the Aswan meeting.

The reason given for Carter adding Egypt to his world tour was to offer Sadat an explanation for the American President's recent public stress on the view that there should be no Palestinian state.

Begin, who said Carter telephoned him from the Presidential plane after it left Egypt, seemed to be using arguments that would appeal to the American public.

In addition to saying a Palestinian state could become a Soviet base, Begin noted that "there are now several million American Mexicans in the United States. They don't ask for creation of a Mexican state on the border between Mexico and the United States. What we suggests is the principle of self-rule, which is fair and just because we suggest autonomy for the Palestinian Arabs and security for the Palestinian Jews."

Meanwhile, Foreign Minister Moshe Dayan told students in Haifa that in the negotiations so far, Egyptian officials have said there was a possibility of a separate Israeli-Egyptian agreement if other Arab states refuse to join in peace talks.

Dayan quoted the Egyptians as saying they are paving the way for comprehensive Arab-Israeli peace settlement but that Egypt would not necessarily stop the peace process if Syria should try to veto the over-all accord.

From the way Dayan recounted the purported Egyptian view, it seemed to be directed more against Syria than against Jordan. All those involved in the peace talks now agree that Jordan is needed to conclude a deal on the West Bank.

Dayan said Egypt takes a hard line on the West Bank because it does not feel it can afford to compromise the interests of others. But, he said, the Egyptian negotiators have been seeking details on the Sinai, Egypt's own Israeli-occupied land, while seeking nothing but generalities about the West Bank. Dayan said that getting someone to represent the West Bank Palestinians in the peace talks is a major dilemma. He said he would recognize the elected mayors on the West Bank, even pro-PLO figures, as legitimate negotiating partners provided they specify that they represent the area's population and not the PLO.

On the future of the Sinai, Israeli television reported today that Israel has proposed that U.N. troops occupy the eastern part of the peninsula after Israeli forces pull back under a peace agreement with Egypt.

Meanwhile, it is being widely reported by the Israeli media that there was a row in the Cabinet meeting yesterday over Agriculture Minister Ariel Sharon's plans to continue to establish new settlements in occupied areas, especially in the northern Sinai.

The ministers of the Democratic Movement for Change, led by Deputy Prime Minister Yigael Yadin, and of the Liberal Party faction of Begin's dominant Likud bloc, reportedly argued that more settlements in Sinai now would be taken by Egypt as a provocation.

It was accordingly decided, the reports said, that existing settlements would continue to be beefed up but that there would be no new ones for the time being. The Israeli lands administration, a consistently hard-line arm of the Israeli government, immediately took out advertisements in Israeli newspapers for 125 building lots in Yamit, the largest of the northern Sinai settlements. Located south of Gaza, Yamit has a population of about 800.

Representatives of Gush Emunim (Faith Bloc), the extreme nationalist group that insists on Israeli sovereignty over the occupied territories, said that they plan to go ahead with plans for three new settlements on the West Bank - at Shilo, Haris and Elon Moreh. Those sites were approved by the Cabinet two months ago, before Israeli-Egyptian peace talks had entered their present phase.

Gush Emunim has expressed increasing distrust of Begin. Its chief ideologist, Hanna Porat, has met twice at length with Begin in recent days but has refused to discuss the talks. Those who saw Porat after the two sessions said he looked extremely dejected.

A new public opinion poll indicates that 90 per cent of Israelis now consider Sadat sincere in his search for peace. Before the Sadat visit to Israel in November, 90 per cent thought there would be war with the Arabs in the next decade. That has since fallen to 60 per cent, with those who expect a new war apparently expecting it with Syria. Unlike Egypt, Syria does not want peace, according to 85 per cent of Israeli's polled.