WASHINGTON, April 30 (Reuters) - US Secretary of State Hillary Clinton said on Friday she expects indirect talks between Israel and the Palestinians to begin next week.

We will be starting with proximity talks next week, Clinton told reporters, saying US special envoy George Mitchell would be returning to the Middle East.

US President Barack Obama's efforts to revive peace talks have been stymied by a disagreement over Jewish settlement construction that has strained ties between Washington and its close ally Israel.

Clinton said the United States looked forward to a meeting of Arab states in Cairo on Saturday night to support the commitment by (Palestinian) President (Mahmoud) Abbas to move forward with these talks.

Ultimately we want to see the parties in direct negotiations and working out ... all the difficult issues, she added.