The ferocious fighting in Gaza between Israel and Hamas, the militant group, might seem to make the prospect of peace between Israelis and Palestinians more distant than ever. Stand back from the spasm of violence, however, and the two sides are closer than the fighting might suggest.

Polls show consistently that the majority on both sides agree that the solution to their conflict must be two states side by side: an Israeli state with a Jewish majority and a Palestinian state. No doubt they would be edgy, suspicious neighbours and any agreement would be grudging on both sides but the acceptance of the concept has taken root.

On the main issues there is now more agreement than division on how these states could look and function.

Territory

The Palestinians have long insisted that Israel must withdraw to the borders recognised by the United Nations before the 1967 war when Israel seized the West Bank from Jordan and Gaza from Egypt.

The negotiations are now down to detail that might seem pedantic elsewhere.

The latest idea is of a “land swap”, whereby Israel would keep the four main settlements in the West Bank that have been built over the 1967 line and have grown into virtual cities, such as Maale Adumim, essentially a suburb of Jerusalem.

In return for recognising that reality on the ground, the Palestinians would be compensated with land from within the borders of Israel proper. Maps have been drawn which would cede areas of the southern Negev desert to a Palestinian state.

The two sides are now only percentage points apart. Ehud Olmert, the outgoing Israeli prime minister, has offered the Palestinians 93% of the area of the West Bank. Mahmoud Abbas, the Palestinian president, has said he could cede 2% but no more, according to Palestinian sources.

Israel has said that it would uproot 70 of the 120 settlements on the West Bank, home to about 60,000 settlers. But 440,000 people would stay.

Jerusalem

Both sides claim the city as their capital and it remains a hugely contentious issue. However, the Israelis have accepted that no deal can be made that does not offer the Palestinians some part of Arab East Jerusalem. There are various ideas for an international component for the sites holy to Jews, Muslims and Christians in the Old City.

Linking Palestinian lands

The Palestinians insist their state must be contiguous, so there are various solutions that would connect Gaza on the Mediterranean in the south to the West Bank, which lies to the north. They range from a tunnel that would cost billions of dollars (preferred by Israeli security), to a bridge, to a heavily guarded road that would go from Gaza to the West Bank city of Hebron.

Refugees

Millions of Palestinian refugees, who left what was then the British mandate of Palestine during the 1948 war, are scattered far and wide.

They want to come home, but most of those homes are in what is now Israel and their return would overwhelm and end the idea of a Jewish state. The outlines of a solution would be to allow refugees the right to return only to the West Bank and Gaza. Those relinquishing claims to their ancestral homes would be given compensation.

Security

Israel wants to be sure that once it cedes control of territory, rockets will not start coming over the border, as they have from Hamas in Gaza. One proposal is for an international force in the West Bank. The Palestinians have requested a multinational force led by the Americans.

It is also worth noting that the Israeli use of Gaza as proof that rockets would come from the West Bank is somewhat disingenuous. While Israeli soldiers did pull out of Gaza in 2005, Israel retained control of the borders, air and sea; and for the past 18 months, since Hamas took power, it has maintained a virtual siege which destroyed the economy and radicalised many living in the coastal strip.

Elections

There is no doubt that the violence, now in its third week, has set back the chances of any peace negotiations. And getting them onto a track that could realistically result in a settlement is made more difficult by the weakness of both governments.

In Israel, Olmert faces corruption charges and stepped down as his party’s candidate for leadership, leaving Tzipi Livni, the foreign minister, as the candidate for the centrist Kadima party which is now in power. Lacking military credentials, she is vulnerable to a challenge from Binyamin Netanyahu, the hard-line Likud candidate, who was ahead in the polls last week for the February 10 election.

Abbas is also weakened by the fact that his writ runs only in the West Bank since Hamas’s violent coup in Gaza in 2007.

For any settlement with the Palestinians to succeed, there would first have to be unity between Fatah and Hamas, which rejects the existence of Israel, or the election of a Fatah-dominated government. Elections are due next year.

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