UPDATE 1-Israel reinforces troops outside Gaza as border protests enter 7th month

Israel said it was reinforcing troops around Gaza on Thursday as a precaution against Palestinian border protests now in their seventh month, and threatened the enclave's ruling Hamas Islamists with a "very harsh" response in the event of attacks.

The Israeli statements did not appear to herald any imminent offensive in Gaza but suggested stronger action at the frontier to foil any further Palestinian attempts to breach Israel's security fence during the demonstrations, which began in March.

Israeli army gunfire has killed at least 193 Palestinians since, Gaza medics say. An Israeli soldier has been killed by a Palestinian sniper. Tracts of Israeli land have been burnt up by incendiary materials flown over the border by kite or balloon.

Israel accuses Hamas of orchestrating the mass-mobilisations to provide cover for attacks and distract from Gaza's economic plight, allegations it denies. Hamas seized control of Gaza from Western-backed Palestinian President Mahmoud Abbas in 2007 and has since fought three wars with Israel, most recently in 2014.

"If Hamas thinks that as a consequence of this distress it can attack Israel, it will be making a very big mistake. Our response will be harsh, very harsh," Prime Minister Benjamin Netanyahu told reporters alongside visiting German Chancellor Angela Merkel.

The Israeli military said it had "decided on wide-scale reinforcements in the southern command in the coming days and the continuation of a determined policy to thwart terror activity and prevent infiltrations into Israel from the Gaza Strip".

Israeli media said the new deployment included Iron Dome rocket interceptors, indicating concern that Hamas or other armed factions could attempt cross-border launches. The Israeli military declined to confirm or deny those reports.

In an interview published on Thursday in Israel's Yedioth Ahronoth daily and Italy's la Repubblica newspaper, Hamas's Gaza-based leader Yehya Al-Sinwar was quoted as saying that "a new war was not in anyone's interest" but "an explosion was unavoidable" unless the "siege" on Gaza was lifted.

Citing security concerns, Israel and Egypt maintain tight restrictions on the movement of people and goods along their borders with Gaza, a policy that the World Bank says has brought the enclave of 2 million people to economic collapse.

Netanyahu accused Abbas, with whom his peace talks stalled in 2014, of "greatly aggravating" the situation in Gaza by withholding funds for its civil servants and infrastructure.

The cuts are widely seen as an attempt by Abbas to press Hamas to implement a power-sharing agreement that would give the Palestinian Authority a measure of control in the enclave.

"Abu Mazen (Abbas) meddles in every way in the U.N.'s attempts to alleviate the distress in Gaza - including now, including today," Netanyahu said.

Merkel, whose 24-hour visit does not include the Palestinian territories, said she would seek to discuss Gaza with Abbas.

Gaza protesters demand an end to the Israeli and Egyptian blockade and rights to lands that Palestinian families fled or were driven from on Israel’s founding in 1948.

(Additional reporting by Dan Williams in Jerusalem and Joseph Nasr in Berlin;Editing by Richard Balmforth)

(With inputs from agencies.)