Israeli commentators sharply criticized a prisoner exchange with Hizbullah on Wednesday, saying it gave a propaganda victory to the Lebanese militant group and set a dangerous precedent.

The Maariv daily newspaper said Israel had been humiliated, arguing that Hizbullah leader Sayyed Hassan Nasrallah "will entrench his image as the only Arab leader who fought against Israel and defeated it."

"No one except for him -- neither the Lebanese government nor the Arab League, the U.N. or the Red Cross -- none of these brought home a proud Lebanese citizen, who had been rotting in an Israeli prison for 29 years," it said.

The paper, which described the event as "shameful and embarrassing," was referring to Samir Qantar, a Lebanese fighter for a Palestinian militant group, who was jailed for life for his role in a 1979 commando raid in which three Israeli civilians, including a child, were killed.

"No Arab entity before him kept Israel in suspense until the last moment, conducted tough negotiations with it and did not even reveal whether its POWs were alive," Maariv added.

Right up to Wednesday's exchange, Hizbullah refused to confirm the deaths of the two soldiers it captured in a cross-border raid in 2006 -- Eldad Regev and Ehud Goldwasser.

Prime Minister Ehud Olmert said Israel's willingness to bring the two soldiers home even at a high cost was a sign of its "moral strength."

"This is a day of ending doubts, certainly about Eldad and Ehud, may they rest in peace, but also about Israel's moral strength," he said in a statement. "The mutual assurance, the concern for each one of our soldiers, is what unites us as a society and is what allows us to survive in an environment surrounded by enemies and terror organizations."

The Israel Hayom daily said however that the swap "sends a negative message to our enemies."

"Israel's willingness to pay a real price for kidnapped soldiers who are not known with certainty to be alive -- or worse, who are known to be dead -- could cause the other side to think that it has no interest in keeping hostages alive," it said.

The paper voiced concern that the exchange with Hizbullah would have a negative impact on negotiations with the Palestinian Hamas movement for the release of Corporal Gilad Shalit, a conscript seized in a deadly cross-border raid from Gaza in June 2006.

It said the release of Qantar would inevitably embolden Hamas to demand that Israel drop its longstanding refusal to release Palestinians "with Jewish blood on their hands."

Hamas meanwhile hailed the exchange as a "great victory for the resistance and for Hizbullah" and said it had set a precedent for the future release of prisoners implicated in deadly attacks on Israelis.

"It proves that a useful way to liberate prisoners from the jails of the occupation is to capture Zionist soldiers, since the occupation refuses to release prisoners and keeps arresting more of them," spokesman Sami Abu Zuhri said in a statement.

The Jerusalem Post meanwhile said that, "in the eyes of the Arab world, Hizbullah pulled off a major victory," while the Haaretz daily said the Shiite group's hand will be further strengthened in Lebanon.

Echoing the press comment, the chairman of parliament's powerful foreign affairs and defense committee, Tsahi Hanegbi, said "no country in the world is open to exchanging terrorists for cadavers; this is an expression of weakness on our part."

President Shimon Peres meanwhile struck a somber tone during a brief memorial ceremony at his office, saying "Israel is in tears" but that it had won a moral victory by bringing its soldiers home.

"We paid a high price for Ehud and Eldad to be able to rest in peace among us. Where is the supreme moral victory? It is here, with the candles of remembrance, and not there. Shame on Lebanon."(AFP-Naharnet) (In this photo released by the Israeli Government Press Office Israeli Prime Minister Ehud Olmert hugs Karnit Goldwasser, wife of Israeli soldier Ehud Goldwasser next to his coffin at Shraga army base in northern Israel)