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CAIRO - Mohammed Bassiouni, Egypt's former ambassador to Israel, denied that he was also an intelligence officer, as some media reports suggested last week.

"Since 1980, when I was appointed to the Israel post, I have had no contact with Egyptian intelligence. I reported solely to the Foreign Ministry," Bassiouni said in an interview with Haaretz.

Bassiouni also said no progress had been made toward a deal to free Gilad Shalit, which has now become more complicated than ever.

In his elegant apartment in Misr Al-Gedida, Cairo, a casually dressed Bassiouni fumed over reports that his ambassadorship was a cover.

He was also cited as criticizing Israel's "maltreatment" of its Arab citizens and saying he has "bitter" memories of Israel and that former prime minister Ariel Sharon was a "sleeping corpse."

"I have denied it all with my own words on live radio [in Israel], yet 10 days after the event, you're still publishing incorrect things. Why do you seek enemies where you don't have any?" he said.

"I have and have had many social connections in Israel. To this day my friends call me on my birthday and I call them. It's important to understand the difference between official work and the personal, social level. At the professional level there are no friendships. I, like any other ambassador, act to advance my country's interests. It is customary to say that policy has no religion, it's all interests. The social level is an entirely different matter," he said.

Bassiouni, head of the Foreign Relations Committee in the Shura Council (Egypt's upper house of parliament) and chairman of the foreign affairs and national defense committee, denied that Egyptian President Hosni Mubarak was angry with him for arranging a meeting with Rabbi Ovadia Yosef, as was reported.

"That's nonsense," he said. "Do I, as the ambassador, set the policy for who meets the president?"

He said he initiated the meeting between the two because he thought the president should meet high-ranking Israeli officials from all the factions "religious, secular, from left and right."

Bassiouni was very cautious in voicing an opinion about Israeli political figures, or about which one would best advance the peace process.

He does believe that Yisrael Beiteinu leader Avigdor Lieberman is a "radical right-winger." However, "we made peace with a right-wing party, with Menachem Begin," he said. "We believed then and we believe now that peace can be made only with a strong leader."

Does that mean that Olmert, being politically weak, could not make peace?

"Only if he displays strong leadership," he said.

The talks between Israel and the Palestinians, headed by Mahmoud Abbas, are going nowhere, and Israel, until the prisoners' release, has given the Palestinians nothing, he said.

'Israel is not responding'

"Israel is not responding even to the Arab initiative, although it ensures Israel peace with all the Arab states and does not demand the right of return, but only a just and agreed solution for the Palestinians."

Bassiouni is not taking part in the Egyptian-brokered negotiations between Israel and the Palestinians, but is following them closely. He said no progress has been made toward a deal regarding Gilad Shalit, because both Israel and Hamas are digging in their heels and refusing to budge.

"Releasing prisoners to Hezbollah made Hamas raise its demands, assuming that if Israel agreed to release [those prisoners] for bodies, it would release many more for a living soldier," he said.

He believes, however, that releasing the 200 prisoners to Abbas will make Hamas reassess its position, especially because of public pressure in Gaza for a similar achievement by Hamas.

The proposed deal to exchange Shalit for prisoners is now more complicated than ever, he believes. It is no longer a stand-alone issue, but is linked to the stability of the truce (tahadiyeh), to Fatah-Hamas dialogue, and to the opening of the Rafah frontier post.

"Egypt is continuing its talks with Hamas to stabilize the tahadiyeh, and I think the efforts can be seen as a success," he said.

Next week, Egypt will start discussions with each Palestinian faction separately to draft an accepted formula, which would be submitted to the Arab League for approval and would serve as a binding basis for an agreement, he said.

Egypt would only agree to open the Rafah pass on the basis of the 2005 border crossing agreement, he said. The agreement includes Israeli cameras at the border terminal, to which Hamas adamantly objects.

"It's an international agreement that Egypt will not violate even if Hamas thinks otherwise," he said.

Bassiouni dismissed Hamas' argument that Egypt promised to open the border passes even if Israel objected. He implied that only progress in all these tracks could advance the Shalit deal.