Doha is increasing its investment in rebuilding Gaza to US$400 million, up from $254 million, Gaza's Hamas premier said on Tuesday during a landmark visit by Qatari Emir Sheikh Hamad bin Khalifa al-Thani.

"The emir agreed to increase Qatari investment from $254 million to $400 million," prime minister Ismail Haniyeh said during a press conference in Khan Yunis in southern Gaza to mark the emir's visit.

The visit is a diplomatic coup for Hamas, whose government has been boycotted by international dignitaries since the movement forcibly took over Gaza in 2007, ousting forces loyal to the western-backed Palestinian Authority of president Mahmud Abbas.

The aim of the Qatari leader's visit was to inaugurate a $254 million investment project to rebuild the impoverished Gaza Strip which sustained major damage during a 22-day Israeli operation that began in late December 2008.

The project will include the construction of roads, housing and infrastructure, as well as agricultural development, officials said.

Haniyeh hailed the top-level visit as a "victory" over the political and economic siege on his government.

"You are officially declaring the end of the political and economic blockade imposed on the Gaza Strip by the forces of injustice and tyranny," he told the emir.

His remarks referred to the political boycott of his government as well as the Israeli-imposed blockade, in place since 2006, that prevents Palestinians from bringing construction materials into the territory.

"Today we demolish the wall of the blockade through this visit, thank you Qatar," he said.