Israel and Hamas have reached a deal that would see the release of captured Israeli soldier Gilad Shalit within a week, a Hamas source told AFP on Tuesday.

The source from the Ezzedine al-Qassam Brigades, Hamas's armed wing, said the deal would be implemented "within days" and it was also confirmed by a source close to Hamas.

"A deal between Hamas and Israel has been reached with full Egyptian mediation on the implementation of a prisoner exchange within a week," the source told AFP, speaking on condition of anonymity.

He added that Hamas chief Khaled Meshaal was expected to deliver "an important address" in two hours, which was expected to address the long-awaited deal.

The confirmation came as Israeli Prime Minister Benjamin Netanyahu convened an emergency meeting of his government to discuss what his office called a "serious proposal" for Shalit's release.

Shalit has been held since his capture by Gaza-based militants in 2006. Several rounds of talks over a prisoner exchange deal have stalled despite the efforts of mediators including Egypt and Germany to help the sides agree a release accord.