updated 8/28/2007 9:24:21 AM ET 2007-08-28T13:24:21

Israeli Prime Minister Ehud Olmert and Palestinian President Mahmoud Abbas tackled the major issues dividing the two sides at their meeting on Tuesday — final borders, Jerusalem and Palestinian refugees, an Israeli official said.

It was the first time the two men discussed these matters in depth, the official said.

“These core issues have to be discussed on the way to finding a diplomatic solution of two states for two peoples,” the official quoted Olmert as saying.

He spoke to The Associated Press on condition of anonymity because the talks were private.

Pressure is mounting on the two sides to work out differences that have blocked the resumption of peace talks that stalled in 2001 amid intensifying violence.

The United States has been prodding Israel and the Palestinians to make progress before the November conference. Olmert’s office said Tuesday’s meeting in Jerusalem was part of an attempt to reach understandings before then, but spokesman David Baker said earlier that the big three issues “would not be discussed.”

Abbas and Olmert have been meeting regularly for several months, in an attempt to boost Abbas against Islamic Hamas militants who violently seized control of the Gaza Strip in June. So far, there have been few concrete results, with Israel preferring to focus on general outlines and the Palestinians pressing for detailed talks on the main issues.

Biggest obstacle: Final borders
The biggest obstacles in past peace talks have been about what the final borders of a future Palestinian state would look like; whether Palestinian refugees from the 1948 war that accompanied Israel’s creation would be allowed to return to their homes; and whether the holy city of Jerusalem could be shared.

The Israeli daily Haaretz said Olmert would insist on adhering to the phased approach of the U.S.-sponsored “road map” peace plan of 2003, which called for the disbanding of Palestinian militant groups at the outset and the establishment of a Palestinian state in stages.

The road map foundered shortly after it was presented because both sides failed to carry out initial obligations.

The Abbas-Olmert meeting is taking place in the context of two important developments on Monday: the dramatic rescue of an Israeli soldier by Palestinian police and Israeli Defense Minister Ehud Barak’s assertion that Israel would not be ready to make a large-scale pullback from the West Bank for 2 1/2 years.

Barak said a significant withdrawal would have to wait until Israel had a missile defense system in place in the West Bank, which is just miles from major Israeli urban centers.

His comments drew immediate fire from Palestinian officials.

“I find it very hard to comprehend such statements when the prime minister and the Palestinian president are doing their best in order to achieve the end game,” meaning a peace agreement, Palestinian negotiator Saeb Erekat said.

But the rescue of the soldier was expected to improve the atmosphere at the meeting.

Soldier rescued
Palestinian police rescued the soldier after he drove into the West Bank town of Jenin — the army said he did so by mistake — and was surrounded by a mob that later burned his car. Israel praised the rescue as a sign of the growing strength of Palestinian moderates.

Three policemen spotted the Israeli military officer inside the car and escorted him through the mob before taking him to their headquarters, police said. The soldier suffered no injuries and was handed over to Israeli troops.

Israelis said the rescue could be a sign Abbas is in firm control of the West Bank, despite losing Gaza to Hamas.

“This operation proves that the Palestinian government and its forces are growing stronger in the field relative to the terrorist organizations,” Foreign Minister Tzipi Livni said, according to the Israeli daily Haaretz.

In the Voice of Palestine Radio interview, Abbas also said he and Olmert would discuss ways to ease the daily lives of Palestinians in the West Bank, where movement is restricted by Israeli roadblocks, and in Gaza, which has been isolated since the Islamic militant Hamas wrested control in June.

“All our day-to-day concerns will be presented in the meeting,” Abbas said.

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