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Spy story delights Egypt and irks Israel. False identities, coded messages, secrecy - the story of a real-life, Mideast James Bond has all these elements. And a TV drama about this Egyptian `mole' inside Israel has captured Arab imaginations. Israelis scoff at his exploits, but to Arabs, Rafaat el-Gammal is a hero.

He was a man of dubious origin and vocation. Arrested in Libya by the British, with four passports in his possession, he seemed to be a man who could switch identities without difficulty. And so Egyptian authorities recruited him, put him to work for the nation, and he became a national hero. His real name was Rafaat el-Gammal, and he was Egypt's man in Israel, a Middle Eastern James Bond.

An Arab and a Muslim, Mr. Gammal was given a Jewish identity. As Jack Bitton, Gammal first penetrated Egypt's Jewish community, then was sent to Israel in the early 1950s posing as a businessman. In more than 20 years there, he was said to have cultivated contacts with high-ranking Israeli officials and to have sent back, via wireless, sensitive information on Israel's military intentions.

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Although he died unnoticed in West Germany seven years ago, a recent novel and television series - using the fictional name el-Hagan - have not only brought him in from the cold, but have captivated Egyptian audiences and stunned Israel.

Now, Egypt's government-run television is working on the sequel, to be filmed in January and aired next April. The second group of programs will cover the period from ``Mr. Hagan's'' arrival in Tel Aviv to the time when he began to gather sensitive information as an Egyptian mole, says Saleh Mursi, the Egyptian novelist and screenwriter who broke the story and is writing the TV sequel.

The television drama helps provide a glimpse into the Egypt of today and into the Egyptian view of the world.

It marks the first time that television has taken a look at Egypt's Jewish community, which once numbered hundreds of thousands but is now down to about 200 aging members. Most fled to the West in the 1940s and 1950s, because the war in Palestine and Israel's invasion of the Sinai Peninsula made life less secure for them here.

In the TV series, many of the Jews are portrayed in a derogatory fashion - as moneylenders with long noses and beady eyes, who frequent a grim caf'e. A menacing version of ``If I were a Rich Man,'' a song from the musical Fiddler on the Roof, sets the mood for their dealings.

Some observers say the television series was timed to stress Egypt's Arab credentials and that Cairo, despite a 1979 peace treaty, still considers Israel a foe.

Taking a somewhat different angle, a well-informed source says, ``A political decision was made to boost the morale of military intelligence.''

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Israeli news reports, however, reject Egyptian claims that Gammal passed on valuable information, an indication that Israel, long considered invincible by itself and the Arabs, finds the opposite hard to take.

``He was of no service to the Egyptians,'' says an Israeli reporter who insisted Gammal had known nobody influential in the Jewish state.

``Every country has to build its self-confidence,'' says an Israeli diplomat in Cairo, indicating that he considers the exploits in the novel as largely fantasy.

But despite Israeli disclaimers, an Egyptian spy did escape detection in Israel for 20 years.

Mursi, who has written several thrillers based on real spy capers, says he was approached in 1985 by a ``friend'' in military intelligence who showed him a 70-page document about Gammal, a move that would most likely need to be condoned by high-ranking Egyptian officials.

Fascinated, Mursi took the bait and began writing.

He went beyond the documents, meeting with Gammal's German wife, Waltraud Bitton, who only then discovered that her husband had been an Egyptian spy.

``I love Rafaat el-Gammal,'' Mursi says.

``He was one of those rare males, an Egyptian young man who went into the hell itself and continued in Israel for 20 years, and nobody knew about him until now. He was an unbelievable genius. He sent us everything about everything in Israel.''

Mursi contends that Gammal, who owned a travel agency in Tel Aviv, befriended officials, including the late prime ministers David Ben-Gurion and Golda Meir, and gave Egypt ``full information'' about Israel's 1956 attack on the Sinai and on its preemptive strike in June 1967.

In both cases, Mursi says, Egyptian officials failed to take the tips seriously. In 1973, he says, Gammal personally delivered to Egyptian agents in Rome detailed maps of the Bar Lev line, an intelligence coup that allegedly enabled Egypt to move its troops quickly across the Suez Canal at the start of the October 1973 war.

With a dynamite tale in hand, Mursi published his novel in 1987. It quickly became a bestseller. The first TV series was broadcast to 14 Arab countries besides Egypt. About 100 million people viewed it.

``All the Arab world is searching for a hero,'' Mursi says, explaining the show's popularity. Referring to Egypt's first president, Gamal Abdel Nasser, Mursi says, ``When Nasser died, he took everything with him, including our dignity.'' Gammal, he implies, restored it.

Aside from the boost in morale that Gammal, alias Hagan, has posthumously bestowed on Egypt, the revelations have had an effect on Gammal's son, Daniel Bitton, who grew up thinking he was Jewish.

After the news came out, Mrs. Bitton came to Cairo to implore the Egyptians to grant her son Egyptian nationality. The request was denied.

But Mursi says that when things calm down, Daniel Bitton's request will be honored, and the boy will be recognized not as the progeny of an Israeli businessman, but as the son of an Egyptian hero.

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