Prime Minister Binyamin Netanyahu called Monday for an immediate renewal of negotiations with the Palestinians, but stopped short - even while standing next to Egyptian President Hosni Mubarak - of endorsing a two-state solution. "I hope these talks will indeed start up again in the coming weeks," Netanyahu said, after emerging from a longer-than-expected 90-minute one-on-one meeting with Mubarak in Sharm e-Sheikh. Mubarak, however, said that two states would form the basis of a resolution to the Israeli-Palestinian conflict, and that the talks should pick up where the Annapolis negotiations left off. It was important to resume the talks "on the basis of a clear political horizon that deals with the final-solution issues and establishes an independent Palestinian state side by side with Israel in security and peace," he said. Even though Netanyahu did not endorse two states, one government source said that Industry, Trade and Labor Minister Binyamin Ben-Eliezer, who accompanied the prime minister because of his strong connections with some Egyptian officials, told his interlocutors that Netanyahu realized that an agreement with the Palestinians would be based on two states. Egyptian intelligence chief Omar Suleiman was among those whom Ben-Eliezer met. Netanyahu, in his public comments, repeated his three-pronged policy, one that would include diplomatic negotiations with the Palestinians alongside economic cooperation and the "activities of the Palestinian security apparatus that serve the security for both peoples." Israeli government sources said Netanyahu emerged "upbeat" from the talks, and felt there was a "convergence of interest" between Israel and Egypt on a large number of issues that were discussed. The two leaders discussed "everything," from Gaza to Gilad Schalit, Hizbullah to Iran, the official said. Regarding Iran, Netanyahu alluded to the threat the Islamic republic and its regional proxies, Hamas and Hizbullah, posed, by saying that the struggle in the Middle East today was "not a struggle between peoples or a struggle between religions, It is a struggle between extremists and moderates, a struggle between those who seek life and those who spread violence and death." Today, the prime minister said, "we are witness to extremist forces who are threatening the stability of the Middle East." He added that Israel expected Egyptian "help in the struggle against extremists and terrorists who threaten peace." Netanyahu, on his first trip abroad since becoming prime minister, said he came to Egypt to "strengthen the connection between Israel and the largest and most important Arab country." He said he also came to strengthen the connection between the "ancient Jewish people and the large Arab nation." The Jewish people "want harmonious relations with the Muslim world," and Israel "yearns to reach peace with its Palestinian neighbors, and with all the Arab nations; we all live in this region, and we are all the sons of Abraham," Netanyahu said. Just as the Jewish people's roots were intertwined with those of the Arab world, "our future is intertwined with yours," he said. Mubarak, during his comments, said that he raised the settlements issue during his meeting with Netanyahu. He also said that the possibility of a truce in Gaza was discussed. Three decades had passed since the signing of the Israeli-Egyptian peace treaty, "proving that peace is not impossible," the Egyptian president said. "Peace is made by the strong and is achieved by those who possess the courage to make difficult decisions and are able to commit to their implementation," he said. In an interview with Channel 1, Mubarak said that public opinion in Egypt was preventing an invitation from being issued to Foreign Minister Avigdor Lieberman. In the interview, Mubarak lamented the lack of progress in the Israeli-Palestinian peace process, emphasizing that there would be no normalization with the Arab world "without Israel giving something." Mubarak said that Egypt was "working on" a Hamas-Israel truce, and concerning the issue of captured IDF soldier Gilad Schalit, he said the heavy media coverage in Israel "only makes them [Hamas] raise the price." The Egyptian president went on to say that Cairo-Jerusalem ties were "developing all the time." According to Egypt's official Middle East News Agency, Mubarak indicated that Netanyahu affirmed during their meeting "his government's commitment to seek peace," and Mubarak said Egypt was looking forward to "a positive position" that reflected this commitment and would lead to peace on the Palestinian track, based on the two state-solution, which would then pave the way for movement on the other tracks. An Egyptian official called Netanyahu's statement about renewing negotiations with Palestinians as soon as possible "very positive." "If he wants to start negotiations and he wants to build relations with the Muslim and Arab world, this is fine," the official told The Jerusalem Post. The official also confirmed that Cairo had been informed that the prime minister would soon appoint someone to lead the negotiations for the release of Schalit. "We are ready, ready for the continuation of the negotiations," the Egyptian official said. "We look at it as a humanitarian issue, bringing back Schalit to his parents and his family and also the release of the Palestinian prisoners as an interest for both parties. "Besides, solving the issue of Schalit can impact positively on other issues, [such as] reaching a tahdiyeh [calm] with Hamas."