The Islamist group Hamas has reached agreement with other Palestinian factions on a statehood initiative that implictly recognises Israel's right to exist.

The agreement came after weeks of negotiations on a document penned by Palestinian prisoners in Israeli jails. Of the various Palestinian factions, only Islamic Jihad is not party to the agreement.

"We agreed on all the points of the prisoners' initiative," said a Hamas spokesman, Sami Abu Zuhri.

The 18-point statehood manifesto has been pushed by President Mahmoud Abbas, who has seen EU and US funding dry up for the Palestinians since Hamas won parliamentary elections in January, taking over from Mr Abbas's Fatah faction as the majority party. Mr Abbas had threatened to call a referendum on the document in a month's time if Hamas did not accept it.

Sources in Hamas and Fatah said that some "small changes" had been made to the document to give Hamas wriggle room. "All the obstacles were removed and an agreement was reached on all the points of the prisoners’ document," Rawhi Fattouh, a senior Abbas aide, said the initialling of the accord.

Mr Fatthouh said that Mr Abbas and Ismail Haniyeh, the Prime Minister, would formally announce the deal later in the day. A Hamas spokesman confirmed an agreement was reached.

Officials close to the negotiations said that Mr Abbas and Mr Haniyeh drafted a platform based on the manifesto, accepting a Palestinian state in the West Bank and Gaza Strip. Such a two-state solution to the Israeli-Palestinian conflict would be in line with Fatah’s recognition of Israel.

But the officials also said that the agreement stipulated that moves towards statehood, including Arab initiatives seeking peace with Israel and international resolutions on the conflict, must serve Palestinian interests - which could allow Hamas to reject, on those grounds, any accommodation with Israel, or recognition of the Jewish state.

With the Palestinans preparing for a possible Israeli offensive in Gaza following the kidnapping of an Israeli soldier, there appears to be little chance that the agreement will lead to a rapid thawing of relations between Hamas and the Israelis.

Palestinian bulldozers blocked roads in northern Gaza with sand piles, bracing for a possible Israeli invasion after the abduction of a young Israeli corporal in a dawn raid on Sunday. The bulldozers, operated by Palestinian militant groups, left small spaces in the sand piles to allow cars to pass slowly.

"We are ready to confront any stupid act that the Zionists might commit," said Abu Obeida, spokesman for Hamas’ military wing. "We are well prepared and God willing, we are not going to welcome them with flowers."

Israel has said that leaders of the ruling Hamas movement could become assassination targets, including the group’s supreme chief Khaled Meshaal, who lives in exile in Damascus.

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