Israel and Palestinians close in on peace deal

Israel and the Palestinians have made good progress in drawing the borders of a future Palestinian state, say negotiators.

The talks in the Egyptian resort of Taba had been suspended for two days following the murder of two Israelis in the West Bank.

Israeli and Palestinian negotiators have been trying to narrow gaps on four key issues - Jerusalem, Palestinian refugees, land and security.

Palestinian Planning Minister Nabil Shaath said a Palestinian map outlining the state recognised the principle of a land swap - Israel would annex small parts of the West Bank, and the Palestinians would get some Israeli land in return.

Other Palestinian negotiators said the gaps on the future of the West Bank were small. They said the Palestinians agreed to an annexation of up to 3%, while Israel proposed keeping 4%.

Progress was also made on the issue of Palestinian refugees, said Shaath.

While Israel refuses to recognise the right of return of nearly four million refugees and their descendants, it has suggested it is ready to assume some responsibility for their plight, he said.

"When the Israelis admit that they took your land and that they should give you compensation for it, we consider this progress in the Israeli position," Shaath said.

Israeli negotiator Yossi Sarid said talks would have to end four or five days before Israel's February 6 election.

He said the Israeli delegation is still hoping to reach a detailed peace accord in the next few days, but that it is aware of the time constraints.