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Rival Palestinian factions have agreed on a document implicitly recognizing Israel.  Israel rejects the plan, which has been at the center of a Palestinian power struggle.

The ruling Islamic militant group Hamas and the rival Fatah faction have agreed to a document calling for a Palestinian state in the West Bank, Gaza Strip and East Jerusalem. That implies recognition of Israel within the pre-1967 borders.

Moderate Palestinian President and Fatah leader Mahmoud Abbas pressured Hamas to accept the plan in a bid to end international sanctions that have crippled the Palestinian Authority and economy. The United States and Europe cut off hundreds of millions of dollars in aid to the Hamas-led government because of its refusal to renounce violence and recognize Israel.

However, the document does not explicitly recognize the Jewish state and it calls for continuing attacks against Israeli soldiers and settlers in the West Bank. Therefore, Israel says it is a non-starter. Government spokesman Ra'anan Gissin says once Hamas gets the state it wants in the West Bank and Gaza, it will wait for the opportunity to continue its holy war against Israel.

"Hamas is not offering any peace with Israel, it's offering a stay of execution. In other words, 'we'll give you 10 or 15 years of peace and quiet and then we'll destroy you when we're strong.' This is not a deal for us," Gissin says.

Palestinian analyst Bassam Eid believes the Palestinian agreement will not accomplish anything.

"If it already rejected by the Israelis, also rejected by the U.S., unfortunately it's not going to be so helpful for the Palestinians, and it's not going, of course, to open any kind of peace process between the Palestinian Authority and Israel," Eid says.

Palestinian officials described the agreement as a breakthrough. But Israel said that the kidnapping of an Israeli soldier by Hamas militants two days ago renders the document meaningless.