Ehud Barak held talks with Omar Suleiman, Egypt's intelligence chief, on a cease-fire agreement between Israelis and Palestinians in Hamas-controlled Gaza mediated by Egypt and coordinated last month with a coalition of 12 small Palestinian factions.
According to Haaretz, the Israeli defense minister told Suleiman that the truce deal should include the release of abducted Israel Defense Forces (IDF) private Gilad Shalit, who has been held captive in the Gaza Strip since June 2006, and a complete cessation of rocket and terrorist attacks from the Gaza Strip.
Barak said Tel Aviv would never agree to any deal that would restrict IDF operations in the West Bank.
Israel also insists that Palestinians must stop smuggling of arms into the Gaza Strip.
After two hours of consultations with Barak, Suleiman said he had "high expectations" that a cease-fire deal could be reached between Israel and Hamas Islamists controlling the Gaza Strip, the paper said.
He is expected to meet later on Monday in Jerusalem with Israeli Prime Minister Ehud Olmert and Foreign Minister Tzipi for further discussions on the deal.
Radical Islamic movement Hamas, which seized control over Gaza in June 2007, agreed to the Egyptian initiative in April and expressed hope that the truce would eventually extend to Palestinians in the Israeli-occupied West Bank.
