Instead, Israel has threatened a punishing offensive in the Gaza Strip.

In northern Gaza, Palestinians began blocking roads with mounds of earth as Israeli armour massed on the other side of the border and Israel awaited word on the fate of Corporal Gilad Shalit, kidnapped by fighters who infiltrated on Sunday.
   
Izz al-Din al-Qassam, the governing Hamas movement's armed wing, along with the Popular Resistance Committees (PRC) and the Islamic Army, said Israel would not get information about the soldier unless it freed all jailed Palestinian women and prisoners under 18 years old.

Ehud Olmert, the prime minister, held Hamas and the Palestinian Authority chaired by Mahmoud Abbas, the president, responsible for the assault on Sunday.

Olmert speech

"The question of releasing prisoners is not on the agenda of the Israeli government at all," Olmert said in a speech.

"The time is approaching for a comprehensive, sharp and severe Israeli operation. We will not wait forever.

"We will not become a target of Hamas-terrorist blackmail."

Israeli troops deployed on the
border await further orders 

Abbas held another round of talks late on Monday with Ismail Haniya, his prime minister, in Gaza.

An official said Abbas appealed to Haniya to try to locate the soldier.

"The president and prime minister met to discuss the matter of the soldier and efforts by the government to find him," the Palestinian official said on condition of anonymity.

Abbas had earlier ordered a search for the conscript to try to stave off possible military action by Israel.

Mushir al-Masri, a Hamas legislator, said: "We are ready to face the Israeli aggression."

Diplomacy urged

Condoleezza Rice, the US secretary of state, urged Israel late on Monday to give diplomacy a chance to win the release of the Israeli soldier.

She said: "There really needs to be an effort now to try to calm the situation, not to let the situation escalate and to give diplomacy a chance to work to try to get this release."

"Military Statement 1", issued by the three resistance groups, did not confirm directly that they were holding Shalit, nor give details of his condition.

Israeli and Palestinian officials said about 100 Palestinian women and 300 youths were in Israeli jails for alleged security offences.

Families protest

On Monday, families of Palestinians jailed in Israel demonstrated in Gaza to demand that resistance fighters holding the soldier hostage trade him for the release of their relatives.

Prisoners jailed for fighting Israel are widely seen as heroes by Palestinians.

"Kidnap one soldier and free 100 prisoners," chanted parents, friends and relatives of prisoners at a rally in Gaza on Monday.

Gazans called for their relatives
in Israeli jails to be freed

In a separate statement, the PRC said on Monday it had kidnapped a Jewish settler in the occupied West Bank. It produced no evidence to substantiate the claim.

"We have all the proof and the details about the location and the operation, but we will leave the enemy in its confusion," the PRC statement said.

The Israeli army said it had no knowledge of any abduction in the West Bank but was checking the claim.

On Sunday, fighters from Gaza dug under a border fence, killed two soldiers and abducted Shalit, a 19-year-old tank gunner.

It was the first such incident since Israel's withdrawal after 38 years of occupation.

Resistance groups said the raid was in response to the killing of 14 Palestinian civilians in Israeli air strikes in Gaza against fighters behind cross-border rocket attacks.