Egypt, Israel work to free soldier; Mediators: 'He's hurt, but alive'

Prime Minister Ehud Olmert yesterday ordered the Israel Defense Forces to prepare for a massive ground incursion into the Gaza Strip in response to a Palestinian assault on an IDF outpost that resulted in the kidnapping of Corporal Gilad Shalit.

However, the operation was promptly put on indefinite hold, for fear of endangering Shalit, and the cabinet announcement was apparently issued primarily as a way of pressuring the Palestinians to release him.

Israel also attempted to apply pressure through various other channels yesterday, including asking American and Egyptian officials to press the Palestinian Authority for Shalit's return, and by warning the PA that Israel would start targeting senior Hamas leaders, including members of the Hamas-led PA government, if Shalit is not returned unharmed. Hamas was one of three organizations that participated in the assault on the outpost, which is located on the Israeli side of the Gaza-Israel border.

The assault also killed two soldiers - First Lieutenant Hanan Barak, 20, of Arad and Staff Sergeant Pavel Slutzker, 20, of Dimona - and wounded another seven, of whom three were released after being treated by the hospital. Of the other four, two were lightly injured, one was moderately injured, and the fourth was initially classified as seriously injured, but has since improved and is now in moderate condition.

Speaking at a meeting of the diplomatic-security cabinet, Prime Minister Ehud Olmert said: "The era of restraint has ended. Until now, there was a form of what is called restraint, due to Israeli interests connected with the diplomatic issue. Today's events ended this definitively."

Olmert, who said that he held PA Chairman Mahmoud Abbas "solely responsible," insisted that Israel would not release Palestinian prisoners to secure Shalit's freedom. While the kidnappers have thus far issued no demands in exchange for Shalit's return, they are believed to want the release of some or all of the 9,505 Palestinian prisoners in Israel.

"We will respond, and it will be a powerful response, more than an operation lasting a day or two," Olmert added. "We will operate gradually and in several stages."

Earlier, he told the regular cabinet meeting that he holds both Abbas and the PA's Hamas government responsible for the kidnapping, "with all that this implies."

The cabinet's summary statement declared that "the Palestinian Authority will bear responsibility for any harm to the soldier, and no person or organization will have immunity in this matter. The cabinet approves the defense establishment's recommendation to prepare the necessary forces for an urgent military operation."

Olmert and Defense Minister Amir Peretz were authorized to approve such an operation. However, several ministers, including Shimon Peres, Eli Yishai and Meir Sheetrit, urged restraint during the meeting.

Yesterday morning, after it became clear that Shalit had been kidnapped, the IDF sent a relatively large tank and infantry force into Gaza to search for him. The force combed the area within a kilometer of the border fence and apparently found the kidnappers' tracks, but did not penetrate further into Palestinian territory. While in Gaza, the tanks and accompanying helicopters kept up a steady barrage of deterrent fire.

Palestinian security officials said yesterday that an attempt to smuggle the soldier over the border was a definite possibility.

However, Peretz rejected defense officials' proposals for a series of assaults on Hamas infrastructure and refused to pass them on to the cabinet. The defense officials had argued that Israel could not afford not to respond harshly to a cross-border attack by members of the PA's ruling party.

Diplomats residing in Gaza who are involved in trying to arrange Shalit's return told Haaretz last night that they have succeeded in locating the group that is holding the soldier, and that the kidnappers have promised that he is being well-treated. According to Palestinian sources, Shalit was moderately wounded in the attack, but is now in stable condition. Israeli intelligence has confirmed that he was wounded.

The diplomats declined to give details about the identity or whereabouts of the group holding Shalit, but said that they knew the answers to these questions. They also said that they are currently in contact with two leaders of Hamas's military wing, Ahmed al-Jabari and Ahmed Randoor, in an effort to persuade them to release Shalit.

Egyptian intelligence officers, meanwhile, held talks yesterday with Khaled Meshal, the head of Hamas's political bureau, who lives in Damascus, and later voiced optimism about the prospects for Shalit's return. The Egyptians, Abbas and senior Fatah officials all believe that Meshal was behind the attack on the outpost. Egyptian President Hosni Mubarak urged his intelligence services to do whatever they could to facilitate Shalit's release.

Palestinian security officials said that Shalit was probably being held in southern Gaza, most likely in Rafah.

Though the assault and kidnapping took place at about 5:30 A.M., it was only at about 2 P.M. that IDF Chief of Staff Dan Halutz formally announced that Shalit was alive. At a press conference on Kibbutz Kerem Shalom, near the military outpost that was attacked, Halutz announced: "The soldier lives, as far as our information goes." He added that he views the Palestinians, "from the greatest to the least of those engaged in terror, as responsible for the soldier's fate. We will do everything necessary in order to get him back."

Halutz added that Hamas was involved in the kidnapping "from toe to head - double entendre intended," a reference to the organization's senior leadership, which heads the PA government.

Defense Minister Amir Peretz made similar statements at a press conference later in Tel Aviv, declaring that the PA "is infested with terror from head to toe."

"Anyone who harms this soldier should know that the soldier's blood is on his head and the heads of his leaders," Peretz added. "All of those involved in this should understand that the price will be painful. And if nothing changes - it will be seven times as painful."

R., the deputy head of the Shin Bet security service, told the cabinet that the assault was carried out by Hamas and the Popular Resistance Committees. He added that Hamas has been involved in much of the recent escalation in Gaza, among other things, by supplying Islamic Jihad and the Popular Resistance Committees with the Qassam rockets that they have been firing at Israeli towns on an almost daily basis.

Hamas has kidnapped Israeli soldiers several times over the past 17 years, usually with the goal of exchanging them for Palestinian prisoners held by Israel. However, though Israel has frequently released prisoners to obtain the return of kidnapped Israelis from other organizations, it has never agreed to conduct prisoner exchange negotiations with Hamas.

	Soldiers removing the bodies of two comrades killed yesterday near Kibbutz Kerem Shalom, on the Gaza border. (AP)