- The Washington Times - Tuesday, March 17, 2009

JERUSALEM (AP) - The prospects for the outgoing Israeli government to clinch a last-minute deal bringing home a soldier held in Gaza looked bleak Tuesday, as efforts to reach a prisoner swap with Hamas appeared to be over.

The Israeli Cabinet held a special meeting to discuss the deal to free captured Sgt. Gilad Schalit in exchange for Palestinian prisoners, huddling for some three hours before leaving without comment.

Prime Minister Ehud Olmert planned to make a nationally televised statement Tuesday evening, his office said. But even before that, meeting participants signaled they had abandoned the negotiations and would turn over the matter to the incoming government of Benjamin Netanyahu.

“The prime minister was prepared to make far-reaching concessions, far beyond what some of the ministers were willing to do,” Justice Minister Daniel Friedmann told reporters after the meeting. “Hamas’ demands reached proportions that no Israeli government could accept.”

“Hamas will also discover that there are lines that Israel is not willing to cross,” he added.

As ministers discussed the faltering deal, the Schalit’s parents and brother sat outside Olmert’s office, wearing T-shirts with the soldier’s picture that said “help.” They did not speak to reporters.

Late Monday, Olmert, who is expected to leave office as soon as this week after a new government is formed, said no deal had been reached. He accused Hamas of making unrealistic demands and being inflexible. Olmert spoke shortly after Israeli negotiators returned from two days of Egyptian-brokered talks in Cairo.

Throughout the day, prospects further deteriorated, with Israel and Hamas accusing each other of undermining the negotiations.

Even so, Hamas leaders voiced hope for a last-minute breakthrough.

“The door is not closed. We believe the occupation is going to retreat,” Osama al-Muzeini, a Hamas leader in Gaza, told the group’s radio station Tuesday afternoon.

The Islamic militant group is seeking the release of hundreds of Palestinian prisoners in exchange, including dozens convicted in deadly attacks on Israelis.

As ministers arrived for the meeting, hundreds of demonstrators gathered outside, urging the government to find a way to bring home the 22-year-old Schalit.

Israel is holding an estimated 8,000 Palestinian prisoners in its jails, and Hamas wants some 1,200 freed, including 450 who masterminded or were otherwise involved in suicide bombings and other deadly assaults.

Israel balked at approving the entire list and wanted to deport some of the more notorious prisoners, fearing they would resume their militant activity if they returned home, Israeli officials said.

“The Zionist occupation is trying to maneuver on the number of the prisoners, trying to exclude some of the names we listed, or to deport dozens of them, and this is rejected by Hamas,” Hamas official Salah Bardawil said.

Hamas officials say the list includes the Palestinians’ highest-profile prisoner, Marwan Barghouti, considered a likely successor to Palestinian Authority President Mahmoud Abbas. Barghouti has spent the past seven years in an Israeli prison for his role in attacks that killed four Israelis and a Greek monk.

A continued impasse over Schalit could have far-reaching consequences for war-battered Gaza.

Israel has said it would not ease its crushing blockade of the territory, home to 1.4 million Palestinians, before Schalit returns home.

As long as the blockade is in place, Gaza cannot import the construction materials and equipment it desperately needs to rebuild after a fierce Israeli offensive early this year.

A prisoner exchange accord might also shore up efforts to clinch a sustained truce between Israel and Hamas. Although Israel’s three-week military campaign ended in an informal truce, Gaza militants continue to fire rockets at southern Israel, drawing Israeli airstrikes in retaliation.

Developments on these two fronts might give a boost to Palestinian reconciliation talks, which are vital to Gaza reconstruction and have been going on in Cairo for nearly two weeks without any reported breakthroughs.

World donors are ready to contribute billions of dollars to rebuild Gaza. But they won’t funnel reconstruction funds through Hamas, which is branded by the West as a terrorist group.

Hamas overran Gaza in 2007 after trouncing forces loyal to the Fatah movement of Abbas, Israel’s Western-backed peacemaking partner.

Winning the soldier’s release would give Olmert a diplomatic victory in his final days as prime minister. Schalit was captured early in his administration and Olmert’s inability to free him has dogged his tenure.

Netanyahu is putting together a hawkish government that might be less receptive to Hamas demands.

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