Palestinian caretaker Prime Minister Salam Fayyad unveiled his plan to establish a de facto state within two years on Tuesday.

Fayyad’s plan is to build up the apparatus of a state in the West Bank and Gaza even before Israel has withdrawn its forces from Palestinian land.

He said the Palestinian Authority wants to take “positive steps … despite the occupation.” “This is on the path to freedom,” he said at a Ramallah news conference on Tuesday.

"The Palestinian government is struggling determinedly against a hostile occupation regime ... in order to establish a de facto state apparatus within the next two years," he said.

“To make this dream come true we have to extend all efforts to make this state exist,” he also said.

Fayyad added that “anti-settlement and anti-wall committees” should be involved in this process of state-building, promising to involve “all sectors and all segments” of society.

The 65-page plan calls for the construction of an airport in the Jordan Valley, rail links with neighboring countries, and beefed-up Palestinian security forces.

In an interview with the British newspaper The Times, Fayyad explained his strategy as a way of bypassing peace negotiations that have yielded few results.

“We have decided to be proactive, to expedite the end of the occupation by working very hard to build positive facts on the ground, consistent with having our state emerge as a fact that cannot be ignored. This is our agenda, and we want to pursue it doggedly,” he told The Times in remarks published on Tuesday.

The newspaper said that, in Fayyad's view, if Palestinians built their own state institutions, it would force Israel to decide whether it is serious about ending its 42-year occupation of the West Bank and Gaza.

Fayyad is a US-trained economist and former employee of the World Bank and the International Monetary Fund (IMF). He was appointed as prime minister in June 2007 in the wake of the Hamas takeover of Gaza and the breakup of the last Palestinian unity government.