CAIRO, Egypt (AP) - Palestinian factions opened talks yesterday
aimed at producing a cease-fire, and Israel hinted it could reduce
military activity in the West Bank and Gaza Strip if a truce were
declared.

Egypt is mediating the talks, and Egyptian intelligence chief
Gen. Omar Suleiman opened the session by urging the Palestinians to
agree to a total cease-fire conditioned on Israeli reciprocity,
Palestinian delegates at the meeting said.

Suleiman told delegates the United States was eager for a
breakthrough next year - an election year. The Egyptian
intelligence boss also said an accord now could further feed
opposition among Israelis to Prime Minister Ariel Sharon's
policies, one delegate said, insisting on anonymity.

"It is possible to take advantage of these conditions to come up
with a cease-fire that the Israeli side will feel compelled to
commit to," Suleiman was quoted as saying. "This requires that the
groups think about the political moves to stop the aggression
against the Palestinian people."

After Suleiman spoke, representatives of a dozen Palestinian
factions began meetings among themselves, with Palestinian Prime
Minister Ahmed Qureia set to join the talks at a later stage.

Hamas and Islamic Jihad, the militant groups behind most suicide
bombing attacks on Israelis, have joined the talks despite their
inclination against a cease-fire. They are under pressure to accept
a truce - from Egypt, Yasser Arafat's mainstream Fatah faction and
smaller groups backing Fatah in hopes of gaining some say in future
talks with Israel.

In the clearest statement yet that Israel will respond favorably
to a cease-fire offer, a defense official suggested Israel would
scale back its military operations if the Palestinians pledge to
halt attacks.

"If the Palestinians agree to a cease-fire in Cairo, it's
certainly not out of the question that Israel will agree to
restrain its military activity," Deputy Defense Minister Zeev Boim
told Israel Radio yesterday.

Arafat, whose position on a cease-fire remains crucial, despite
U.S. and Israeli efforts to isolate him, gave public backing to the
Cairo talks yesterday.

"The most important thing is to try to reach an agreement ... in
order to implement the 'road map' (and) stop the daily Israeli
escalation against our people," he told the pan-Arab satellite
station Al-Jazeera.

Egypt wants the cease-fire to eventually lead to a resumption of
Palestinian-Israeli negotiations, a goal of the United States. U.S.
envoy William Burns was in the region this week to press both sides
to fulfill their obligations under the "road map," the latest peace
plan backed by Washington and the international community.

An inter-Palestinian agreement on a cease-fire offer would
strengthen Qureia's hand in negotiating with Sharon when the two
meet. A meeting has been in the works since last month but no date
has been set.

The Palestinians - ranging from the mainstream to Islamic
militants and Marxists - have met informally with Egyptian
officials and among themselves since Tuesday.

Delegates to the talks say they are weighing both a partial
cease-fire - to halt strikes on civilians inside Israel's territory
- and a broader truce, being pushed by Egypt, that would curtail
attacks on Israeli soldiers and Jewish settlers in the West Bank
and Gaza.

Israel has reason to agree to the cease-fire; when it kept up
its own attacks during the last truce arranged by Egypt in June,
the Palestinians waited only seven weeks before resuming suicide
bombings, with devastating results.

Zalman Shoval, an adviser to Sharon, stressed that a cease-fire
must be total and followed by dismantling militant groups as
required by a "road map" peace plan.

"Israel welcomes a cease-fire, but it must be the first step,"
he said.

Under the "road map," Palestinians would stop violence and make
efforts to disarm violent cells, while Israel would halt attacks
against Palestinians, withdraw forces from Palestinian towns,
freeze settlements and take steps to normalize Palestinian life.
The "road map" calls for establishment of a Palestinian state by
2005.

Qureia has not accepted U.S. and Israeli demands to dismantle
radical groups, especially Hamas, because they have a strong
political constituency among Palestinians.

Apparently giving Qureia some latitude, Secretary of State Colin
Powell last week suggested the Palestinian prime minister could
take steps short of taking up arms against militants and find
support from the international community.

The Palestinians say a comprehensive cease-fire - a total end to
fighting - would require Israel to also stop settlement building,
halt construction of a security barrier along the frontier with
Palestinian areas and withdraw troops from sectors reoccupied since
the outbreak of fighting in September 2000.