Hamas has rockets capable of striking Ashdod and Kiryat Gat, according to Shin Bet chief Yuval Diskin. The head of the security force informed the cabinet yesterday that "it is only a matter of time" before these long-range rockets will be used. Diskin also warned that "the chances of a calm with Hamas are very slim."

The Shin Bet sees the arms smuggling into the Gaza Strip as the most important security concern there at the present time.

Diskin stressed that so long as the Philadelphi Route that runs along the border between Rafah and Sinai is not totally blocked, the range of the rockets smuggled into the Strip will only be increased.

Iran continues to assist Hamas, Diskin said, asserting: "We have identified Iranian efforts to transfer more sophisticated rockets to the Gaza Strip."

During his briefing of the cabinet, Diskin expressed his opposition to the agreement that is being proposed for a truce with Hamas in Gaza.

"Hamas is preparing for another round of escalation," Diskin explained. "Time is in Hamas' favor and the threat on Israel is only getting worse."

The Shin Bet chief said that in the worst-case scenario, Israel would be faced with an escalation in violence; in the best-case scenario, it will achieve a truce that has few chances of lasting. He added that if Hamas is given time to strengthen its capabilities, any future military operation in the Strip will claim more Israeli casualties.

Diskin also briefed the cabinet on Hamas' positions regarding Israel's conditions for a truce, as relayed to the Egyptian mediators.

"Hamas does not accept Israel's conditions and wants to gain time so that it can build up its military capabilities," the Shin Bet chief said. "There is skepticism in Hamas, but they have not closed the door before negotiations for good." He added that, "if Palestinian Authority President Mahmoud Abbas will not be part of the agreement for a calm, this will seriously weaken him."

Diskin noted that Hamas has presented Egypt with a definitive demand for lifting the siege on the Gaza Strip, and also for a timetable for the opening of the crossings at Rafah and elsewhere into Israel. Hamas has also demanded that Egypt promise that if the indirect negotiations fail, Cairo will open the Rafah crossing for Palestinian traffic to and from the Strip.

"The siege is very effective," Diskin said. "The longer it continues, the more Hamas will intensify its efforts to carry out attacks at the border crossings."

He noted that Hamas is strongly opposed to any demand that it cease the smuggling of weapons, and is unwilling to impose a cease-fire on the other militant factions in the Strip.

Senior Hamas figures told the Egypt's chief of intelligence, Omar Suleiman, who is mediating the truce, that "each group will have to commit to the calm before Egypt, independently."

The question of including the release of captive soldier Gilad Shalit in the deal for a truce, Diskin said, has remained a seriously divisive one that separates Israel and Hamas, and the Islamist organization is unwilling to compromise on this.

In addition, Hamas is demanding as a precondition to a lull that it is given a clear timetable outlining the expansion of the cease-fire from Gaza to the West Bank.

Diskin also warned that there are attempts to carry out attacks and kidnappings in the West Bank, and said the Shin Bet is trying to foil them.

Hamas blames Israel

The Shin Bet chief's version of events, however, was challenged by Hamas yesterday. Ayman Taha, a spokesman for the movement in Gaza, said that Israel is unwilling to lift the blockade on the Strip as part of the tahadiyeh (truce). He accused Israel of seeking only a mutual cease-fire.

Hamas leaders also blamed Israel for failure to make progress in the talks, claiming that the issue of Shalit is not even an obstacle since it is not a precondition for Israel to reach an accord. They charged Israel of wanting to benefit from a cease-fire without having to pay the price for it - in the form of opening the border crossings.

Taha told Haaretz yesterday: "We are demanding the lifting of the entire blockade and Israel is not interested in doing this. This is the central problem at this time."

Hamas did say Israel has asked to have more time to evaluate the tahadiyeh, after which the crossings to Israel will be openned.

Hamas also challenged Diskin's assertions regarding the group's long-range rockets.

"If Israel is worried about a military confrontation with Hamas, then by all means, it should agree to a cease-fire," Taha said.

Other spokesmen, like Fawzi Barhum and Ismail Radwan, also blamed Israel for foiling Egypt's efforts to achieve a tahadiyeh agreement.

Halil al-Hiye, one of the Hamas representatives in the talks with Egypt, said that his organization was waiting for answers from Israel through Amos Gilad, the head of the political-security bureau at the Defense Ministry, who visited Cairo yesterday.

Hamas officials said that Israel's refusal to accept the cease-fire and the opening of the crossings was not reasonable since the whole point of an accord for the Islamic group was the lifting of the siege.

During Diskin's briefing, many in the cabinet expressed their opposition to the agreement being negotiated for a cease-fire. Former Shin Bet chief Avi Dichter, Meir Sheetrit and Haim Ramon expressed their opposition to the truce, adding that they would vote against it in the cabinet.

"It is a serious mistake to hold negotiations with Hamas before we have succeeded in isolating [the organization] in the world," Ramon said. "An agreement with the group will be a de facto recognition of a state of Hamas in the Gaza Strip, and will bring an end to the Palestinian Authority and those who lead it, with whom we are negotiating."

Minister of National Infrastructure Benjamin Ben-Eliezer added: "Hamas rule in the Gaza Strip must be brought to an end."

In response, Prime Minister Ehud Olmert told the cabinet that Israel is not negotiating with Hamas.

"We have presented Egypt with our starting conditions and they must be met," Olmert explained. "There is a huge difference between that and negotiations."

He added: "There is no problem with issuing an order [to the army] to advance, but we need to be certain that an alternative is available, because the cost [of a military move] may make such an operation unproductive."

Meanwhile, the Israel Defense Forces decided yesterday to evacuate dozens of soldiers and civilians stationed at the Erez crossing and to relocate them to a base near Ashkelon. The decision came following last Thursday's massive bomb attack on the Palestinian side of the Erez crossing, and threats by militant groups in the Gaza Strip to carry out more attacks. The evacuation includes those the army described as "nonessential."

The Erez crossing is operated by soldiers and civilians whose job is to coordinate the passage of Palestinians and employees of aid organizations. Military sources said that for these people to carry out their jobs, there is no need for them to stay at the nearby base, which is exposed to bombings and rockets.

Indeed in recent months the Erez terminal has become an ongoing target for militants who operate trucks laden with explosives, rockets and other weapons aimed at the site.

The attack last Thursday involved a truck loaded with what is estimated to have been 4.5 tons of explosives. Even though the blast occured on the Palestinian side of the crossing, it caused millions of shekels worth of damage in a larger area; the offices of the liaison and coordination unit were hit with thousands of pieces of shrapnel and debris.

As a result of the damage suffered there, the crossing remained closed yesterday and entry of a number of Palestinians who were supposed to enter Israel for medical treatment was delayed.

A year ago, a Qassam rocket struck a base of conscripts near Kibbutz Zikim, near the northern Gaza Strip, injuring some 70 soldiers. Following that attack, parents called for evacuating the training base because of the rockets, but the IDF brass refused, saying that "soldiers will not be evacuated from a location in which there are civilians."

The army insisted yesterday that the two cases were not similar, and argued that the nature of the threat to the sites was different.