Disclaimer: The following ideas are overly simplistic and probably quite unrealistic. The entire world would have to be willing to get behind these ideas, and tell both sides that if they don’t go along with it, they’ll find themselves at war with the rest of the world.
Make the holy land areas belong to the world as a whole. No one can live there, only visit. Divide up the rest of the area equitably, with land mass granted based on population. Tell each side to stay the hell out of the other’s space. When they complain, like children who don’t actually want peace, “but that’s not where I want to live!”, the world, like a parent, can say “I know it’s not fair. Life isn’t fair. Deal with it.”
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