The funeral of Eldad Regev at the military cemetery in Haifa Sunday. [Isranet photo]

JERUSALEM – The long-awaited resolution to
the Lebanese hostage crisis has cast a pall over efforts to retrieve the Israeli
soldier held by Hamas in the Gaza Strip.

Gilad Shalit was abducted to Gaza shortly before Hezbollah
snatched Ehud Goldwasser and Eldad Regev to Lebanon in the summer of 2006.
Unlike the two army reservists, who suffered fatal wounds during their
abduction and were repatriated for burial last week, Shalit is known to be
alive.

That, Israeli security sources say, has hindered Egyptian-mediated negotiations
on Shalit’s return. Having freed jailed Lebanese terrorist Samir Kuntar and
four captive Hezbollah gunmen in exchange for two Israeli corpses, Israel is
likely to face troubles bargaining down Hamas when it comes to a living
hostage.

Citing senior Palestinian sources, the Ha’aretz newspaper reported over the
weekend that "Hamas isn’t willing to be flexible about Shalit at this time
due to the recent prisoner swap with Hezbollah.

“Israel set a precedent with its release of Samir Kuntar, considered a
‘prisoner with blood on his hands,’ in return for two bodies,” Hamas supreme
leader Khaled Meshaal said over the weekend. “In our case we have a live
prisoner, and we have no plans to retract our demands — quite the opposite.”

Israeli Prime Minister Ehud Olmert has long balked at the asymmetry of the swap
proposed by Hamas, which seeks the release of some 1,100 prisoners, at least a
third of them serving life sentences for deadly attacks.

Olmert successfully held out against a similar opening demand by Hezbollah,
which had wanted many Arab prisoners, as well as the five Lebanese, freed from
Israeli jails as a condition for returning Goldwasser and Regev.

But as Shalit enters a third year of captivity in conditions that are widely
believed to be primitive, Olmert faces mounting pressure even from within his
own Cabinet to compromise on the ransom.

At least three ministers have publicly backed the idea of releasing at least
some prisoners "with blood on their hands," a reversal of
long-standing Israeli doctrine. One Cabinet member, Ami Ayalon, warned that
failing to retrieve Shalit could risk losing him forever.

In several media interviews Ayalon, a former navy admiral and Shin Bet chief,
compared Shalit’s situation to that of Ron Arad, an Israeli airman who bailed
out over Lebanon in 1986. For the first two years, Arad was held in Lebanon by
various militias while Israel deliberated over if and how to bargain for his
return. Then he disappeared — to Iran, Israel assumes — and the trail went
cold.

Shalit’s family has argued that Hamas eventually could decide to smuggle Shalit
out of Gaza through the Egyptian Sinai and on to Lebanon or Iran.

"The similarities between the cases of Shalit and of Arad are
terrifying," Ayalon said.

Olmert has given no indication of how he might now pursue the Shalit issue,
though on Sunday he offered public reassurance.

"I phoned the Shalit family and promised, in all of our names, that we
will do everything to bring Gilad Shalit back home — alive, healthy, in one
piece, and as quickly as possible," he told his Cabinet in broadcast
remarks.

"I don’t have to tell you that it’s not simple, it’s not easy. Just as we
labored for two whole years, day in and day out, to bring back Udi and Eldad,
may they rest in peace, we are doing the same thing for Gilad Shalit. We will
not be still or silent until he comes back."

Freeing Shalit would be an enormous morale booster for Israel after the
dispiriting sight of Goldwasser and Regev returning in black coffins last
Wednesday. It also could distract from a corrupation case dogging Olmert and
free up Israel’s armed forces to invade Gaza should there be a major resumption
of cross-border rocket fire.

Israeli officials have hinted that the military was being kept in check at
least partly out of concern that Shalit could be executed as a reprisal.

But while Hamas in Gaza might suffer from losing its bargaining chip, in the
West Bank it would reap major strategic rewards.

The release roster filed by Hamas includes scores of its senior West Bank
terrorists, including the planners of suicide bombing campaigns. Returned home
and free to operate, they could undermine Palestinian Authority President
Mahmoud Abbas, who has tried to build on his split with Hamas last year by
reviving peace talks with Olmert and instituting a law-and-order drive in the
West Bank.

"We are talking about creating a ‘general staff’ for Hamas in the West
Bank," said Amram Abramovitch, a senior commentator for Israel’s Channel 2
television. "That would basically eliminate Abu Mazen," he said,
using Abbas’ nickname.

Yediot Achronot reported Sunday that Olmert would convene his security chiefs
to think of a new approach to the Shalit negotiations while dispatching envoy
Ofer Dekel to Cairo with orders to appeal to the Egyptian regime to apply
pressure on Hamas.

Various stop-gap ideas include bringing in French or German mediators, or
holding simultaneous shuttle talks between Israeli and Hamas delegates in Cairo
along the model of the indirect Israeli-Syrian talks under way in Turkey.

But according to an unnamed senior Egyptian official quoted in Yediot, even the
Egyptians are not hopeful of a breakthrough.

"After your prisoner exchange with Hezbollah, we have to let things calm
down," the official said.