Israel and Hamas resumed talks in Cairo last Tuesday aimed at securing the release of Gilad Shalit, an Israeli soldier abducted by Hamas in June 2006, the Al-Hayat Arab paper said on Friday.
Israel has eased its stance in this third round of talks, which are being mediated by Egypt, Al-Hayat said.
Israel had previously refused to release a number of Hamas and other Palestinian leaders convicted of direct attacks on Israelis.
But Al-Hayat said Israel has now agreed to set free all Palestinian female inmates and those Palestinians who had Israeli IDs.
Sources in Egypt told the paper that Cairo had drafted a document detailing the positions of the sides and their common points, and also laying out new ideas on how to bridge the gap between Hamas and Israel.