Talks intensify over potential Gilad Shalit prisoner swap

REUTERS -Egyptian-brokered negotiations between Israel and Hamas over swapping hundreds of Palestinian prisoners for a captured Israeli soldier have made progress but differences remain, officials on both sides said on Monday.


Two days of indirect talks in Cairo ended without word on whether it would be possible to finalise a deal before Israeli Prime Minister Ehud Olmert leaves office.


Olmert was briefed by his two envoys and will convene his cabinet on Tuesday to decide on how to proceed with the negotiations, conducted through Egyptian mediation with Hamas Islamists who rule the Gaza Strip.


Olmert has made freedom for Gilad Shalit, held by Palestinian militants in the Gaza Strip since 2006, a precondition for a wider truce with Hamas and the reopening of the enclave's borders to crucial reconstruction aid after Israel's offensive in December and January.


In exchange for the soldier, Hamas has demanded the release of 1,400 Palestinian prisoners, including about 450 long-serving inmates. Some of those were convicted of attacks that killed Israelis, and critics say a large prisoner swap for Shalit could encourage Hamas and others to try to seize more soldiers.


"There is progress and there is a new (Israeli) proposal, but there are still some differences blocking conclusion of a deal," a senior Hamas official said.


Suggesting the gap was narrowing, an Israeli security source said earlier on Monday that the Jewish state was objecting to the release of fewer than 50 of the prisoners demanded by Hamas.


Exile demand


Another dispute centred over Israeli demands that some of the prisoners be exiled.


"We reject expulsion," Abu Ubaida, spokesman of Hamas's armed wing, the Izz el-Deen al-Qassam Brigades, said on Sunday. "There is no room for more flexibility in our position."


Olmert had scheduled a cabinet meeting for Monday to weigh a possible agreement, but moved it to Tuesday to give his envoys, Yuval Diskin, head of the Shin Bet security service, and negotiator Ofer Dekel, more time to try to seal a deal.


"The ministers will be briefed on the negotiations," Olmert spokesman Mark Regev said. "If there is a need to take decisions, decisions can be taken."


Israeli media said Olmert's cabinet could decide on Tuesday to send the envoys back to Cairo for more talks.


Hamas was represented in the talks for the first time by top military commander Ahmed al-Jaabari -- a sign, sources said, of their seriousness.


Olmert, who has come under mounting public pressure to bring Shalit home, is in the final days of a three-year term marked by a 2006 Lebanon war that many Israelis see as a failure and a 22-day Gaza campaign that ended in January without achieving a complete halt to cross-border rocket fire.


Members of Olmert's outgoing administration have warned Hamas publicly that it may find a new government being formed by right-winger Benjamin Netanyahu less willing to deal on prisoners.


But the senior Hamas official said: "We are not pressed for time."


"There is room to achieve a breakthrough," the official added. "It needs a decision from the Zionist occupation."


Shalit, now 22, was captured in June 2006 by militants who tunnelled into Israel from the Gaza Strip and took him into the Hamas-ruled territory.


Israel has carried out lopsided exchanges in the past, trading large numbers of Arab prisoners for its captured soldiers or their remains.