New Delhi, Aug. 19 -- Hamas has agreed to a 60-day ceasefire with Israel that would see the release of half the hostages in Gaza in exchange for some Palestinian prisoners, an Egyptian official said on Monday - in an Egypt-brokered peace proposal that could bring some relief to Palestinians after nearly two years of war in Gaza.

Earlier, all efforts to end nearly two years of fighting in Gaza have repeatedly collapsed. While Israel has maintained that Hamas must disarm and release all remaining hostages before the war can end, Hamas has demanded a full Israeli withdrawal from the devastated territory.

A diplomat, privy to the development on the negotiations in Israel-Hamas talks, said the peace proposal would see Hamas release half of t...