Israel Mulls Answer to Egypt

ISRAEL'S inner Cabinet yesterday debated a response to Egypt's invitation for Israeli-Palestinian talks in Cairo on the basis of a 10-point Egyptian proposal related to Israel's plan for Palestinian elections. Two counterproposals were brought before the Cabinet. Labor Party ministers proposed to accept the Egyptian initiative, in which Israel would endorse trading land for peace.

Likud Party ministers led by Yitzhak Shamir proposed that the Cabinet express its readiness to take up a proposal by US Secretary of State James Baker III to begin consultations with the US and Egypt on the composition of a Palestinian delegation for the talks. The Likud would also reaffirm rejection of talks with the Palestine Liberation Organization and adherence to the Israeli government's peace initiative.

The Cabinet meeting was still underway at press time.

Labor appeared to have abandoned notions of precipitating a Cabinet crisis over the issue, preferring to wait for American pressure to build on Shamir as he prepares to meet President Bush in Washington next month.

Before debating its response, the Cabinet yesterday heard reports from Rabin, Foreign Minister Moshe Arens, and Finance Minister Shimon Peres on their recent meetings with Egypt's President Hosni Mubarak in Cairo and Washington.

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