(Tribune News Service) - Israel has agreed to increase the number of work permits for Palestinians in its territory by 20,000, sources inform Globes. The increase will bring the number of permits to 100,000. The new agreement was unveiled at a meeting between Minister of Finance Moshe Kahlon and Palestinian Prime Minister Rami Hamdallah. Beyond the economic aspect, the meeting redefines Kahlon's role: in addition to being the symbol of moderation in the cabinet, he is also responsible for managing contacts with the Palestinian Authority (PA) in all areas, including the political arena.Many meetings have taken place recently between senior representatives of the two sides in Ramallah, on the Allenby Bridge and in Jerusalem. The announcements published following these meetings dealt only with economic affairs, but at the end of yesterday's meeting, the parties published announcements of a political nature.Kahlon's office announced that he had called on the Palestinians to resume diplomatic negotiations with Israel under the auspices of US envoy Jason Greenblatt, because the US is the sole "fair mediator" in the region.Hamdallah's office reported that matters not pertaining to economics had been raise at the meeting, including the new building permits in the Jewish communities in the West Bank, IDF operations in Palestinian cities, and incidents between Jewish and Palestinian residents.The two sides made public the direct political channel between the Israeli government and the PA - a channel in which neither Prime Minister Benjamin Netanyahu nor PA Chairman Mahmoud Abbas is involved. Most of the discussions on this channel are economic, but the dialogue between the parties enables them to also deliver messages on other matters. One of the participants in yesterday's meeting said, "The atmosphere was more than positive," adding that the direct connection between Kahlon and Ramdallah was excellent. Most Palestinian journalists today reported the meeting, and some of them featured it on the front pages, signifying that the PA is not afraid to highlight this channel for talks.Kahlon was accompanied at the meeting by Coordinator of Government Activities in the Territories Major General (Res.) Yoav Mordechai and Deputy Minister of Finance Yitzhak Cohen. They met with Hamdallah and Palestinian Minister of Finance Dr. Shukri Bishara. Israel agreed in the talks to help the Palestinians prepare for an audit by the International Monetary Fund (IMF) and meet its criteria for receiving economic aid. The IMF is demanding far-reaching economic reforms and full transparency from the PA as a condition for receiving aid.It was agreed at the meeting to promote the development of three joint industrial zones. Two of these, in Tarkumia and west of Ramallah in the area of Modi'in Illit, are well known. The third and most interesting will be established in the Jordan Valley rift in cooperation with both the PA and Jordan. This industrial zone is also planned as a free trade zone.The Palestinians raised another matter at the meeting - Israel's intention of deducting the money granted to terrorists and their families from the money it transfers to the PA. Globes reported that these grants total NIS 1.1 billion a year, over 8% of the PA's annual budget. Hamdallah made it clear at the meeting that this step would have especially grave political and economic consequences.Another subject brought up at the meeting was the situation in the Gaza Strip. The Palestinians warned that military escalation would bring about collapse in the Gaza Strip. "The residents will be unable to bear the consequences of another military operation," they said. Israel and the PA representatives agree that Hamas's rule must be overthrown in order to begin reconstruction in the Gaza Strip. At the same time, concern was expressed at yesterday's meeting that the support that Hamas is getting from Iran and other countries is causing it to take a harder line, stir up the area, and refuse to fully transfer control of the Gaza Strip to the PA.(c)2018 the Globes (Tel Aviv, Israel). Distributed by Tribune Content Agency, LLC.