Progress in talks to free Israeli soldiers-Nasrallah

BEIRUT, Oct 16 (Reuters) Talks to free two captured Israeli soldiers in a prisoner swap deal are making positive progress, Hezbollah leader Sayyed Hassan Nasrallah said today.

The soldiers were captured by Hezbollah in July 2006 and their abductions triggered a 34-day war between Israel and the guerrilla group in Lebanon.

''I can talk for the first time of the existence of positive progress in these main negotiations, the ones linked to the Israeli soldiers and the prisoners,'' Nasrallah said in a brief televised speech on Hezbollah's Al Manar television.

Nasrallah did not give any indication of the condition of the two soldiers.

His comments came a day after Israel and Hezbollah exchanged the remains of an Israeli civilian for a captured Lebanese guerrilla and the bodies of two of his comrades in a UN-brokered deal.

A UN-appointed mediator, believed to be a German intelligence officer, is working on a deal to get the Israeli soldiers exchanged for Lebanese and other prisoners.

Nasrallah described these talks as intensive and ongoing and said they would resume within days.

''All these indications lead us to look with hope and optimism -- which we did not have in the past months -- but now I can reveal from this side and for the first time speak of hope and optimism of positive progress, on a chance to realise a big achievement and full operation of this kind.'' Yesterday, Israel received the body of Israeli citizen Gabriel Dwat, an Ethiopian immigrant who drowned in January 2005 and whose body was washed onto the Lebanese coast.

In exchange Hezbollah received freed prisoner Hassan Naim Aqil, a Hezbollah fighter captured in the 2006 war, and the bodies of two other fighters, who had apparently been taken to Israel after they died in the conflict in Lebanon.

''Our assessment is that this exchange operation was certainly a big achievement, but in the end it is a partial and limited operation,'' Nasrallah said.

''There is no doubt that what happened yesterday gives an important push to a wider and bigger operation.'' Israeli government officials in Jerusalem had no response to Nasrallah's remarks. But earlier, Prime Minister Ehud Olmert had played down prospects of a quick return of the two captured soldiers, Eldad Regev and Ehud Goldwasser.

UN Secretary-General Ban Ki-moon issued a statement calling on both sides ''to move ahead decisively in releasing the two abducted Israeli soldiers without any further delay and to find the necessary solutions for the remaining Lebanese citizens that are still in Israeli detention''.

Yesterday's swap came four days after Germany said it would grant early release to an Iranian and a Lebanese who were given life sentences for the 1992 assassination of a group of dissident Kurdish leaders at a restaurant in Berlin.

Iranian-backed Hezbollah and Israel last exchanged prisoners in 2004, when Israel released more than 400 Lebanese and other Arab prisoners in return for an Israeli businessman and the remains of three soldiers.

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