GAZA CITY (AFP) – Rockets fired into northern Israel from Lebanon on Thursday jolted efforts to end the war in Gaza where Israeli jets carried out mass strikes on smuggling tunnels in the Palestinian territory.

Three rockets fired at the northern Israeli town of Nahariya injured two women as Israel sent an envoy to Cairo to discuss an Egyptian plan to end the war on the Hamas movement which has left at least 704 dead in Gaza.

Hamas denied it had fired the rockets. Hezbollah, the Lebanese militants who were the target of an Israeli war in 2006, would not say if it was involved.

The Israeli army fired shells into Lebanon at the district where the rockets came from. Residents in the area quickly started to flee fearing a new war front.

The Israeli government made no immediate comment on the strikes. But media cited military sources as saying the rocket attack was likely to have come from Palestinian groups angered by Israel’s offensive in the Gaza Strip.

With the military onslaught in its 13th day, Israeli jets pounded zones near the border with Egypt where Israel says there are hundreds of underground tunnels used by Hamas to smuggle arms into Gaza.

Witnesses said Israeli tanks had also entered southern Gaza.

Israeli planes dropped tens of thousands of leaflets on the Rafah area near the border warning people to leave their houses or face attacks.

There are up to 500 underground passages around Rafah, which are used to smuggle supplies and arms from Egypt into Gaza, an impoverished enclave that Israel has virtually sealed off since Hamas seized power in June 2007.

There were also new air raids in the north of the densely populated coastal strip, with three people hurt when a mosque was hit in Gaza City, medics said.

Gaza medics said 704 people have now been killed and more than 3,100 injured since Israel launched Operation Cast Lead on December 27 — starting with air strikes on Hamas military and government targets and following it up with a ground offensive last Saturday.

Israel says it wants to stop Hamas rocket attacks across the border and the arms smuggling.

Three more rockets were fired into southern Israel from Gaza on Thursday but the Israeli army said there would be a new three hour halt to its bombing from 1100 GMT to 1400 GMT throughout Gaza so the population can get food.

Six Israeli soldiers have been killed in the combat while three civilians and a soldier have been killed in rockets fired into Israel since December 27.

Israel’s security cabinet has agreed to pursue the offensive, but new hopes have been raised by a truce plan proposed by Egypt’s President Hosni Mubarak.

A top Israeli envoy went to Cairo on Thursday for talks on the ceasefire proposal which aims to halt the conflict while bolstering security on the Gaza-Egypt frontier to end the smuggling.

Amos Gilad, a senior advisor to Defence Minister Ehud Barak, was to hold talks with Egyptian officials on the plan which has secured widespread international backing.

Israel’s President Shimon Peres said ceasefire plan was “a general idea” with the details to be hammered out.

The process “could take several days,” he told Italian newspaper La Repubblica in an interview. Peres also said that Gaza must not be allowed to become a “satellite of Iran.”

Western foreign ministers, including US Secretary of State Condoleezza Rice, extended their stay at the United Nations in New York to hold new talks with Arab counterparts on a compromise Security Council text on a Gaza truce.

“We believe there’s still work to do. We are extending our stay,” Rice told reporters.

Libya has submitted a draft resolution that “demands an immediate end” to the Israeli offensive.

A rival non-binding statement circulated by France, which chairs the UN Security Council this month, would merely stress “the urgent need for an immediate and durable ceasefire” and would welcome the truce initiative unveiled by Egypt.

Arab ministers want a vote on the Libyan draft, which requires nine votes and no veto from the council’s five permanent members — Britain, China, France, Russia and the United States — for passage.

A diplomat said the Arab ministers did not want to return home empty-handed and face the wrath of their public opinion, which has been outraged by the high Palestinian death toll in Gaza.

New protests against the Israeli offensive were held around the world. Hundreds of Muslim students stormed a Kentucky Fried Chicken restaurant in the Indonesian city of Palu waving Palestinian flags and burning the US and Israeli emblems.