JERUSALEM -- In the latest and most public signal that relations between Egypt and Israel are improving, Egyptian authorities released yesterday an Israeli-Arab who had been convicted of spying and had served less than half his 15-year sentence.
For Azzam Azzam, it was a jubilant homecoming that ended years of confinement in isolation, as well as agony for his family, who waged a relentless campaign to free the 42-year-old businessman. Azzam's family and the Israeli government contended that he had been unjustly accused and imprisoned.
Azzam's release could pave the way for improved cooperation between Israel and Egypt in resolving the Palestinian conflict and a greater Egyptian role in helping the Palestinian Authority secure neighboring Gaza should Israel withdraw troops and settlers next year.
Israel returned the favor by releasing six Egyptian university students who had illegally crossed into Israel in August and were suspected of plotting an attack on soldiers. Neither side would characterize the dual release as a prisoner exchange.
In a conversation with Egyptian President Hosni Mubarak yesterday, Sharon said that he had ordered Israeli security officials to consider shortening sentences of Palestinian prisoners, according to a statement released by Sharon's office.
Barry Rubin, the director of the Global Research in International Affairs Center in Herzliya, said that Egypt, like other countries, sees an opportunity to press for regional peace after the death last month of Yasser Arafat.
Mubarak has already made an entrM-ie into the election to succeed Arafat by endorsing Mahmoud Abbas, a moderate who wants to end the armed uprising against Israel and who is tacitly supported by Israel and the United States.
"Egypt is concerned about the future of Gaza and they want to get back into the negotiating process," Rubin said. "They were very frustrated with Arafat because he didn't listen to their advice, and Abbas is very close to their views.
"From an Israeli point of view," he continued, "the withdrawal from Gaza requires better relations with Egypt and a hope that Egypt will be more active in blocking arms smuggling across the border. Both sides are very eager for this to work."
The Gaza withdrawal plan, which faces significant internal opposition, was to have been a unilateral move. But Sharon has reached out to Abbas, saying he would consider coordinating the withdrawal with the new Palestinian leadership to ensure an orderly transfer of land and to avoid a takeover by extremist militant groups.
"We have a disengagement plan on the table, and Egypt is interested in implementing it in a way that will move the political process forward," said Shimon Shamir, a professor of Middle East history at Tel Aviv University and Israel's ambassador to Egypt from 1988 to 1990.
"In order to do that, Egypt must be in constant dialogue with Sharon," Shamir said. "They want to establish a good rapport. The Egyptians are generally interested in the peace process, and as long as there is no peace with the Palestinians, their peace with Israel is unfinished business."
Shamir said Egypt also wants to re-establish itself as a central player in the region. "They want to be a constructive element, and doing this with Israel goes along well with improving their image with the United States," he said. "Most of their aims with regard to Gaza converge with Ariel Sharon, so it could only be expected that they work out some warmer relations so that they can work together."
Egypt was the first Arab country to sign a peace treaty with Israel, in 1979, but recent relations between the two nations have been cold at best. Egypt recalled its ambassador to Israel in 2000, at the onset of the Palestinian uprising, and has left the post vacant for the past four years.
But there have been increasing signs that tensions are easing. Even before Arafat's death, Egyptian Intelligence Minister Omar Suleiman made regular trips to visit Sharon and other high-ranking officials to discuss Palestinian issues and to get permission to train Palestinian police to secure Gaza.
Egypt also has played a central role in trying to persuade, albeit unsuccessfully, Palestinian militant groups to agree to a cease-fire. In October, Egypt allowed Israeli rescue workers and unarmed soldiers to cross the border to assist in a hotel bombing that claimed the lives of Egyptians and Israeli tourists.
And Israel agreed this month to allow Egypt to station up to 750 soldiers along its border to help combat Palestinian arms smuggling and thwart future militant attacks. The treaty had allowed for only a small number of lightly armed police.
Last week, Mubarak praised Sharon in comments that generated much fanfare in Israel and Egypt. "Only Sharon can lead the region to peace," he told reporters. "I think if they [the Palestinians] can't achieve progress in the time of the current prime minister, it will be very difficult to make any progress in peace."
The comments seemed to indicate a new era in relations that has even survived an embarrassing mistake by Israel when its soldiers fired a tank shell across the border Nov. 18 and killed three Egyptian police officers, mistaking them for Palestinian militants.
Both sides shrugged off the incident. Israel Radio reported yesterday that Sharon and Mubarak might meet shortly after the Palestinian elections, which are scheduled for Jan. 9.
Azzam had been a continuing sore spot in the two country's relations. He was arrested and accused of industrial espionage in 1996 in Cairo, where he ran a textile factory jointly owned by an Israeli and an Egyptian. Later, the courts charged him with being a spy for Israel's Mossad, accusing him of using invisible ink on women's underwear to pass information. He was convicted in 1997.
Israeli authorities continually denied the charge and pressed for his release. Azzam's family set up a protest tent outside the prime minister's office in Jerusalem and pressed dozens of politicians to intervene. He met with Israeli Health Minster Danny Naveh in October last year, where he told of enduring seven years in an 8-foot-square cell with a bucket for a toilet.
He gave Naveh a letter addressed to Sharon complaining of a prisoner swap with the Lebanese militant group Hezbollah, saying that Israel is "unable to secure the release of an Israeli citizen imprisoned by a country with whom we have signed a peace accord."
Azzam crossed the border at Taba yesterday afternoon and was driven to the airport in Eilat, in southern Israel, in an Israeli police van. He waved to reporters, saying, "I'm very good, thank you, thank you," before being flown to central Israel aboard a military plane.
The Associated Press contributed to this article.