Negotiators at the Cairo peace talks failed to reach agreement by the 13 April deadline for the withdrawal of Israeli troops from Jericho and Gaza. The date was greeted by a second bomb attack inside Israel by the military wing of the Islamist group Hamas.

The most recent bombing killed six people travelling on a bus in the Israeli town of Hadera, a week after a similar attack killed seven Israelis in Afula. Hamas has said it plans three more attacks in retaliation for the Hebron massacre.

Israeli Prime Minister Yitzhak Rabin said after the Hadera attack that he would not allow it to wreck the peace talks. 'What this will lead to is more elements joining in the terror,' he said. Rabin said he expected to sign a deal with the PLO by mid-May.

Speaking to the Council of Europe on the day of the bombing, PLO Chairman Yasser Arafat implicitly condemned the Hadera attack, calling it 'an attack on innocent Israeli civilians' and said it 'strikes at the heart of the peace process'.

The PLO was strongly criticised by Israel's President Weizmann, for not clearly condemning the previous bomb attack in Afula.

Palestinian and Israeli have reached agreement on a number of security issues since talks restarted on 10 April. The two sides have agreed on a Palestinian police force of 9,000, which will be deployed in stages. Once the agreement is signed, 6,000 police from outside the occupied territories will be sent to Jericho and Gaza, with a further 2,000 police recruited from inside. This will be followed by another 1,000 police from outside three months later. All the police will carry an automatic rifle.

The Israelis have said they will release a further 5,000 Palestinian detainees, in two stages, after the signing takes place. However, none of the detainees released will be members of Hamas. Nabil Shaath, the chief Palestinian negotiator, said the fate of the remaining 8,500 prisoners would be discussed in the next round of talks. Israel will also allow the return of 50 deportees.

The economic talks, which have been going on Paris, have reported progress. A joint statement by the two negotiating teams said they expected to reach a final agreement on future economic relations by late April, although there were still differences to overcome in trade and labour policy (see Gaza/West Bank).