Palestinians will be ready for statehood by August, as promised in a two-year action plan, Palestinian Authority Prime Minister Salam Fayyad said in an interview Tuesday, dismissing a host of steep obstacles to independence.

The former World Bank economist visited a rural West Bank road destroyed by Israel to demonstrate his belief that independence is inevitable as long as Palestinians don't lose faith.

The road was torn up by Israeli troops last week, on grounds that it was paved in a nature reserve in an area under full Israeli rule. Fayyad pledged to repair it immediately as part of his new campaign to challenge exclusive Israeli control over large tracts of the West Bank.

"This is where the struggle is, in the rural areas," Fayyad said during the ride back to his Ramallah office.

Despite Fayyad's optimism, signs abound that independence is still a long way off: his motorcade was led by an Israeli police cruiser, and Israeli settlements and unauthorized hilltop outposts on either side of a main West Bank highway.

Fayyad acknowledged the limitations to his authority.

The Israeli police escort is "basically a way of saying, we are in control here," Fayyad said. Israel cites concerns for his safety as the reason for insisting on sending a patrol car whenever he leaves his office in the West Bank town of Ramallah, he said.

In August 2009, Fayyad presented a two-year plan for building state institutions, including schools, courts and infrastructure. The idea was to generate momentum for independence regardless of crisis-prone Israeli-Palestinian peace talks.

With his plan in its final phase, Fayyad said it's time to challenge Israel's exclusive control over vast tracts of the West Bank. Rebuilding the little road is just a symbol.

Fayyad said his next big project is a $400 million international airport near the West Bank town of Jericho. He acknowledged that he does not have funding yet, but said he wants to put facts on the ground.

Israeli government spokesman Mark Regev recommended cooperation.

"This must be done in coordination," he said, "and I think if we look at the progress of the last few years, though many challenges remain, we can see there have been many positive developments."

Fayyad said his government has made good progress on the two-year plan. "It could happen tomorrow, it could happen next month, but certainly no later than August of next year," he said.

Fayyad said his government is becoming less dependent on foreign aid, reducing outside support for the operating budget from $1.8 billion in 2008 to $1.2 billion this year, out of a total of $3.8 billion. By 2013, he won't need any foreign help with the budget, he predicted.