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Egypt has proposed the deployment of Arab troops into Gaza under UN supervision as part of a wider deal that provides for the total withdrawal of Israeli forces from the coastal enclave, a truce and Hamas releasing up to 50 of the estimated 240 hostages it is holding, Egyptian officials said on Wednesday.
News of the Egyptian proposal came one day after US President Joe Biden said, without elaborating, that he believed a hostage release deal with Hamas would happen.
“I've been talking with people involved every single day. I believe it's going to happen but I don't want to get into details,” Mr Biden told reporters at the White House when asked about an eventual agreement.
Asked if he had a message for the families of the hostages, who were captured on October 7 when Hamas went on a deadly rampage in southern Israel, killing about 1,200 people, he said: “Hang in there. We're coming.”
Nine US citizens and a permanent resident are thought to be among the hostages.
The Egyptian proposal was made during marathon meetings on Tuesday in Cairo between top officials from Egypt's General Directorate of Intelligence and counterparts from Israel's domestic Shin Bet security agency.
However, the proposal was rejected by Israeli Prime Minister Benjamin Netanyahu shortly after the meeting wrapped up on Tuesday night, according to the officials.
They said that the US, whose representatives were briefed on the outcome of the meetings, had told the Egyptian negotiators to give them time to discuss the proposal with Mr Netanyahu.
Egypt, which borders Gaza and Israel, is known to be vehemently opposed to the deployment of multinational troops in Gaza as part of post-conflict arrangements in the coastal enclave. It is equally opposed to Israel maintaining a permanent military presence in Gaza.
The Egyptian proposal, according to the officials, is part of a larger deal that envisages Hamas militants freeing up to 50 hostages, mostly women, children and US citizens, in return for the freedom of hundreds of Palestinian women and children held in Israeli jails.
Hamas is also demanding a ceasefire and sufficient supplies of humanitarian aid.
The proposal also envisages a post-conflict political process and reconstruction.
There was no word from any of the parties involved in Tuesday's meetings on the negotiations and it was not clear how they are related to Qatar's efforts to broker a hostage deal. However, past rounds of negotiations are known to have involved Egypt, Qatar, the US, Israel and, indirectly, Hamas.
Mr Biden spoke with Mr Netanyahu on Tuesday, and the White House said the two “discussed at length continuing efforts to secure the release of hostages held by Hamas, including many children and a number of Americans”.
The US has repeatedly asked for a pause in the fighting to allow for the release of the hostages.
More than 11,000 people, including about 4,600 children, have been killed in Israel's relentless bombardment of Gaza and the subsequent ground offensive, in which Israeli troops and tanks rolled through the heart of Gaza city.
Israeli minister Benny Gantz, who is in Mr Netanyahu's cabinet, told a news conference on Wednesday: “Even if we are required to pause fighting in order to return our hostages, there will be no stopping the combat and the war until we achieve our goals.”
Mr Gantz declined to give any details when asked to elaborate on what is hindering the hostage deal.
Any deal faces many obstacles.
It is unclear whether Hamas is currently able to compile an accurate list of hostages it holds since the war has caused communications and organisational problems in Gaza, a western diplomat told AFP.
Gathering the hostages for any simultaneous release, which Israel wants, would be logistically difficult without a ceasefire, said another source in the region with knowledge of the negotiations.
There had also been uncertainty over whether the military and political leadership of Hamas were in agreement on the issue.