Egypt suggests Mideast coalition

CAIRO, Sept. 26 (UPI) -- Officials in Egypt say they are offering a new, broad package deal in the proposed mass prisoner exchange plan aimed at freeing Israeli soldier Gilad Shalit.

Israel has agreed to free 450 Palestinian prisoners in exchange for Shalit, kidnapped by Hamas two years ago.

But, observers say Egypt's new coalition proposal could derail the swap. Some say Egypt is trying to use Shalit as a pawn in Palestinian reconciliation, Haaretz reported Friday.

Egypt wants to combine Shalit's release with an agreement between rival Palestinian factions Hamas and Fatah over the formation of a new coalition government.

The plan would require Hamas to relinquish sole control of Gaza and agree to allow a peacekeeping force of Arab soldiers to be stationed there, while Israel would have to allow the border crossings into Gaza to reopen.