IN his Israeli jail cell Samir Qantar, who is serving four life sentences for murder and terrorism, dreams about an exchange of prisoners that might allow him to go home to Lebanon.

“I can imagine how I’ll return to my village,” he said. “First I hug my mum, then my brothers and sisters, all of them. My idea, which I’ll never give up, is to come out of here with my head held up, without giving up any of my principles.”

Qantar, 44, has been in prison since 1979, when he took part in an attack whose horrifying outcome made him one of the most hated men in Israel.

But in Lebanon, Hezbollah has made his release one of its key demands in negotiations to secure the freedom of Ehud Goldwasser, 31, and Eldad Regev, 26, the two Israeli soldiers it captured on July 12, triggering a 34-day war.

Qantar’s role in the attack on the coastal town of Nahariya 27 years ago would make this an especially bitter pill for Israelis to swallow. A policeman was killed and a family taken hostage when Qantar’s group burst into their home.

Danny Haran, 28, was shot at close range in front of his terrified four-year-old daughter Einat, whose head was then smashed with a rifle butt.

The dead man’s wife Smadar hid in a loft with their two-year-old daughter Yael, keeping a hand over her mouth to stop her crying out. But the girl suffocated, leaving Smadar Haran bereft of her husband and both daughters.

Qantar, the longest-held Lebanese prisoner in Israel, was convicted of the murders of Danny and Einat Haran but his family in Lebanon continues to claim that he could not have killed them because he had been injured in a shoot-out with police by the time they died.

Freedom for Qantar and up to three other Lebanese prisoners is now at the top of Hezbollah’s list of demands in return for the release of the Israeli soldiers. “We are working on making this the year we free our brothers in Israeli detention,” Hezbollah’s general secretary, Sayyed Hassan Nasrallah, told a large crowd in February.

“The whole point of capturing the two Israeli soldiers is to ensure the release of our prisoners in Israeli jails and to bring them to freedom,” a Hezbollah official said last week. “According to Nasrallah, Samir Qantar will address next year’s memorial day for prisoners and he is not someone who retracts his pledges.”

By an extraordinary twist of fate, it seems that Goldwasser, one of the Israeli captives, heard Qantar’s attack when, as a four-year-old boy, he was woken up by gunfire and grenades near the family home in Nahariya. The next morning his parents told him that a girl his age had been murdered by an Arab terrorist who had come from Lebanon. Last week his wife Karnit found herself leading a campaign for a prisoner swap. “I turned 30 while he was doing his reserve duty and he hasn’t yet been able to buy me a birthday present,” she said last week. “Now I’m waiting for the biggest present of my life — his return home.”

In the murky world of Middle East hostage trading, Goldwasser’s homecoming could be a slow and laborious process. One complicating factor in the negotiations, which are being handled by shadowy intermediaries, is Ron Arad, an Israeli airman who parachuted from his burning Phantom jet 20 years ago and was believed to have been captured by militiamen in south Lebanon. His fate remains unknown and many Israelis assumed he was dead. But last week a Lebanese television station claimed that it was about to broadcast an interview with Arad in captivity.

Qantar’s brother Bassem, a journalist who has dedicated his life to campaigning for his release, reflected scepticism about the claim, saying he was certain that Hezbollah’s leadership had done everything in its power to find out what had happened to Arad, but without success. “They spoke with everyone here, they searched, they got calls — many of them fake — about bones that were supposed to be Arad’s,” he said.

In January Nasrallah made a statement in which he concluded that Arad was “dead and lost”. After the soldiers’ capture in July Hezbollah originally demanded the release of hundreds of Arabs held in Israeli jails, but it is widely expected to settle for just the Lebanese inmates. Israel says it has three Lebanese in its prisons and denies knowledge of a fourth that Hezbollah claims.

Last Thursday there was a large rally in Tel Aviv for Goldwasser and Regev, whose brother Eyal said the Israeli prime minister, Ehud Olmert, had promised to make every effort to bring him back. “But we say there should be negotiations with Hezbollah; we should exchange prisoners. No question about it.”

Samir Qantar, meanwhile, has expressed regrets about the death of four-year-old Einat. “The girl was innocent,” he admitted. “She was a little girl and there was no reason she should die. This girl is a very tragic story. It disturbed me then and will haunt me for the rest of my life.”

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