The Iranian government is sending money to Gaza, gradually extending its influence over the region surrounding Israel.

The Islamic Republic has donated $120 million to the Hamas-led Palestinian Authority, according to an announcement last Thursday by PA Foreign Minister Mahmoud al-Zahar. The PA official met in Tehran with Ali Larijani, the head of national security in Iran.

Palestinian Authority terrorists in Gaza have become major beneficiaries of Iranian largesse recently, according to the AFP news service.

“Iran has handed out, until now, over $120 million and says it will supply more aid. Its support is very important for us,” said the PA foreign minister.

PA terrorists have significantly stepped up their Kassam rocket attacks against southern Israeli communities recently. Sderot residents have said the rockets are increasing in accuracy, and now contain more explosives as well as ball bearings to maximize damage upon impact.

Meanwhile, international efforts to stop Iran’s nuclear development activities have slowly ground to a halt. Despite threats by the U.N. Security Council to impose sanctions against the Islamic Republic if it did not end its uranium enrichment program by the end of August, the program continues uninterrupted, and no action has been taken against Iran.

U.S. President George W. Bush said Sunday night he would "understand" if Israel attacked the Islamic Republic, but that America would not help the Jewish State to do so.

According to a report in Monday’s issue of New Yorker magazine, Israeli agents operating in Iran have been passing intelligence information to the White House. The report by Seymour Hersh claimed that the information states that Iran has already developed and tested the technology for a nuclear weapon.

The news reinforces a concern expressed repeatedly by both the U.S. and Israel about repeated claims by Iranian President Mahmoud Ahmadinejad that the nuclear activities currently underway will be used for peaceful, domestic purposes only.

Meanwhile, north of Israel, the Iranian-backed Hizbullah terror organization is ratcheting up its efforts to topple the Lebanese government.

Hizbullah terror chieftain Hassan Nasrallah told thousands of Lebanese supporters to prepare to take to the streets of Beirut in order to force the resignation of the government. He said the current Lebanese government is a puppet of the Bush administration.

Six ministers of Hizbullah and its allies have quit the Lebanese Cabinet after failing to achieve an agreement for a new unity government.

Nasrallah's speech was apparently recorded on Saturday in the southern suburbs of the Lebanese capital, an area repeatedly attacked by Israel during this summer's Second Lebanon War.

Hizbullah touched off the July war with a cross-border attack in which terrorists kidnapped two IDF reservists on patrol and killed several soldiers. The next day, they began launching daily Katyusha rockets against northern Israeli communities.

Thousands of Katyusha rockets rained down upon Nahariya, Haifa, Kiryat Shmona, Tzfat and other Galilee communities, prompting the evacuation of more than a third of the population in at least two cities, and more than half of the residents of Kiryat Shmonah.