A statement from Israeli Prime Minister Benjamin Netanyahu's office said the security cabinet had "unanimously accepted the recommendations to accept an Egyptian initiative for an unconditional... ceasefire."
The month-long stoppage in hostilities in the Alingar district of Laghman province, one of the hardest hit by violence, was called to allow local farmers to harvest their wheat crop and students to sit annual examinations
Tribal elders drafted a demand letter, known locally as an "Ariza", which was then signed by two local officials of each the Taliban and the government.
The Taliban has declared a three-day ceasefire across Afghanistan, to mark Eid al Fitr, only two days after more than 50 people - most of which were young girls - were killed in bomb blasts outside a school in Kabul.
The ceasefire announcement comes as the United States continues to withdraw its last 2500 troops from the war-torn country, as negotiations between the government and the Taliban falter.
In a message comemorating Pakistan Day, Indian Prime Minister Narendra Modi has told his counterpart Prime Minister Imran Khan that his country desires mutually cordial relations.
Prime Minister Modi stated in his letter that "As a neighbouring country, India desires cordial relations with the people of Pakistan", adding that "For this, an environment of trust, devoid of terror and hostility, is imperative."