The Israeli and Palestinian delegations are expected to meet Wednesday to try to agree to a long-term cease-fire plan.
The current cease-fire, which was agreed to on Sunday, will end at midnight on Thursday.
Palestinian sources said early Wednesday morning that Egypt presented the Israeli and Palestinian delegations with a plan for a long-term cease-fire, according to Israel Radio.
The plan called for an end to Israel's air strikes on Gaza, reducing the size of the buffer zone in Gaza along the Israeli border.
Discussions regarding some of the biggest points of contention, such as Israel's call to demilitarize the Strip and Hamas' call to remove the Gazan blockade, would be postponed until a later date, according to the plan.
The full proposal has not been released and there has not yet been official comments from either the Israeli or Palestinian delegations.
On Tuesday, the outlook still did not look bright for the prospects of an extended truce. "We are facing difficult negotiations. The first truce passed without notable achievements. This is the second and final cease-fire," Palestinian news agency Ma'an quoted Mousa Abu Marzouk as saying
A 72-hour cease-fire that went into effect in Gaza on Sunday will expire at midnight Thursday, with Israeli officials unable or unwilling to predict whether it will be extended or the fighting will start anew.
Finance Minister Yair Lapid, a member of the eight-person security cabinet, said the gaps between Israel and Hamas holding indirect talks in Cairo were “wide.”
“It is possible that the fighting will begin again at midnight,” he said in a Channel 2 interview. “But it will not be the same fighting, because we will hit them much harder.”
Lapid said that Israel was dealing “with a murderous terrorist organization that wants to kill Jews,” and it will be “impossible to move forward” unless the security of the communities in the south is secured.
Prime Minister Binyamin Netanyahu cancelled a security-cabinet that was scheduled for Tuesday after it became apparent that there had been no progress in the Cairo talks on Monday, and there was no need for any decisions to be taken. Rather than hold the security cabinet meeting, Netanyahu briefed the heads of his coalition partners in the afternoon.
One diplomatic official said that Israel hoped that the cease-fire would be extended, but that Hamas was the “wild card” and it was not clear how they would react.
Diplomatic officials said that all the options were on the table, and that three scenarios were being taken into consideration: that a longer-term cease fire is agreed upon by midnight; that another 72-hour cease-fire is declared during which negotiations continue on a longer deal; that the cease-fire ends and Hamas again begins rocketing Israeli towns.
The Palestinians, meanwhile, said that almost no progress has been achieved during the Egyptian-sponsored talks.
Unconfirmed reports suggested that Hamas and Islamic Jihad members of the Palestinian negotiating team were considering pulling out from the talks in protest against Israel’s refusal to accept their demands.
They accused Israel of “procrastination” and warned that Hamas and other Palestinian factions would not agree to an extension of the cease-fire.
“Israel is continuing with its policy of foot-dragging and is not taking our demands seriously,” a Palestinian official in Cairo told the Palestinian daily Al-Quds.
“Israel is trying to impose its conditions and this will never happen regardless of the cost. If Israel requests another extension of the cease-fire, our delegation won’t agree.”
The Cairo talks are being under the auspices of Egypt’s General Intelligence Service, with the Israeli team shuttling back and forth between Cairo and Jerusalem. .
Qais Abu Laila, member of the Palestinian team to the cease-fire talks, said that the gap between the two sides remained “very wide.”
Abu Laila said that he and his colleagues have informed the Egyptians that this would be the last cease-fire with Israel.
Yehya Musa, a senior Hamas official in the Gaza Strip, said that his movement was preparing for a “long battle” with Israel.
Musa, who was speaking during a pro-Hamas rally in Khan Yunis, said that the Palestinians “won’t accept humiliation.”
Addressing the Palestinian team in Cairo, Musa said: “We are all behind you until you achieve our just demands. We know that everyone is conspiring against you, but we are confident that you won’t make concessions. Be patient because we have nothing more to lose.”
Palestinian sources told the Palestinian Ma’an news agency that Israel was insisting on discussing the fate of two missing IDF soldiers who were killed during Operation protective Edge, while the Palestinians asked to delay this issue.
According to the sources, Israel has thus far accepted only a few of the Palestinian demands, including increasing the number of trucks loaded with food and goods that enter through Kerem Shalom and Nahal Oz and allowing 5000 Palestinians from the Gaza Strip to enter Israel every month.
Israel has also agreed to drop its opposition to the transfer of funds to pay salaries of Hamas civil servants in the Gaza Strip and expanding the fishing zone gradually, the sources said.
In addition, the sources added, the Israelis and Palestinians have agreed on the reopening of the Rafah border crossing and the deployment of 1000 Palestinian Authority police officers at the terminal, as well as the release of the fourth patch of Palestinian prisoners, who were supposed to be freed earlier this year in accordance with a US-sponsored agreement between the PA and Israel.
However, the two sides have still failed to make progress on several other issues, such the disarming of Palestinian groups in the Gaza Strip, the airport and seaport and a safe passage between the West Bank and Gaza Strip, the sources added.
Israeli officials refused to relate to these reports, with one official saying that Israel did not feel the need to respond to Palestinian “disinformation.”
In New York, meanwhile, US Secretary-General Ban Ki-moon said at a news conference that he hoped a “durable cease-fire “ would be reached soon.
Ban said that 2,000 Palestinians have been killed, including more children than were killed in the two previous Gaza crisis combined; 300,000 people were being sheltered in UNRWA facilities; and 100,000 people have had their homes destroyed or damaged.
“Israel’s duty to protect its citizens from rocket attacks by Hamas and other threats is beyond question,” Ban said. “At the same time, the fighting has raised serious questions about Israel’s respect for the principles of distinction and proportionality. Reports of militant activity does not justify jeopardizing the lives and safety of many thousands of innocent civilians.”
Ban did not mention that on at least three occasions Hamas rockets were stored in UNRWA schools, and that when when discovered they were turned over to Hamas, nor did he mention evidence showing that rockets were launched perilously close to UN facilities.
While directly condemning Israel, Ban only obliquely criticized Hamas, saying at one time during the press conference, though without mentioning the organization by name: “They simply have not listened to those voices of reason and they have not cared [for] their own people. In the name of protecting their own people, they have been letting their people be killed by others.”