Israel's security cabinet meets Tuesday to endorse a prisoner exchange that will free 25 Egyptians from Israeli jails in exchange for a 27-year-old dual U.S.-Israeli citizen who was accused of spying.

Ilan Grapel, who apparently entered Egypt in January, has been jailed since mid-June. It is alleged that he engaged in espionage activities in connection with the popular revolt that toppled former President Hosni Mubarak, although formal charges were never filed.

Israel insists Grapel is not a spy and has no ties with either Israeli or U.S. intelligence services.

The swap is expected to take place Thursday.

A statement issued by the office of Israeli Prime Minister Benjamin Netanyahu said none of the 25 Egyptians being released is considered a security risk. Among them are three minors.

The exchange comes after an Egyptian-mediated deal between Israel and Hamas that freed captive Israeli soldier Gilad Shalit for more than 1,000 Palestinians in Israeli jails.

That deal and the exchange announced on Monday are seen as an attempt to improve relations between Israel and Egypt that have been strained since President Mubarak's ouster in February. Egypt and Israel established diplomatic relations in 1979.

Grapel, who is a student at a U.S. law school, was temporarily interning for a non-profit organization in Egypt when he was arrested.