Netanyahu Says Talks Meant to Preserve Israel’s Jewish Identity

Israeli Prime Minister Benjamin Netanyahu said planned peace talks with the Palestinians are designed to maintain Israel’s Jewish identity and prevent the creation of another Iranian proxy on the country’s borders.

“One of the goals I set for the process itself is blocking the formation of a binational state” of Jews and Arabs, Netanyahu told his cabinet today at its weekly meeting, according to an e-mailed statement from his office. The other, he said, is “preventing the establishment of another Iranian-sponsored terrorist state,” an allusion that would include the Hamas-ruled Gaza Strip.

Netanyahu also said if talks ripen into an agreement, he will bring the accord before Israeli voters in a referendum. Some members of his governing coalition oppose the establishment of a Palestinian state on lands Israel captured in 1967, a key element of any deal.

A Netanyahu ally said Israel has agreed to release an unspecified number of Palestinian prisoners to help get the two sides back to the negotiating table after a three-year impasse. U.S. Secretary of State John Kerry, who brokered the resumption of talks, said on July 19 that the two sides will seek to meet in Washington within the next week or so.

Palestinian President Mahmoud Abbas brought the terms underlying the planned talks before Palestinian leaders today.

Market Indifferent

Israel’s TA-25 Index dropped 0.3 percent to 1223.59 at 12:30 p.m. today in Tel Aviv.

“Israelis are still skeptical regarding a peace process” and “don’t necessarily see any immediate impact” on the markets, Jonathan Katz, a Jerusalem-based economist at HSBC Holdings Plc, said in a telephone interview. “If the talks do proceed to a level where they become more concrete and show a greater chance of success, then the market will become more attentive. For now it’s too early.”

Negotiations between Israel and the Palestinians broke down after Netanyahu declined to extend a 10-month building freeze on new construction in West Bank settlements. The Palestinians, who see the Israeli-occupied West Bank and east Jerusalem as the core of a future state including Gaza, maintain that a growing Israeli presence on those lands is a sign of bad faith. Netanyahu has said negotiations should not be tethered to conditions.

Details Undisclosed

Kerry wouldn’t provide details of the agreement and gave no indication that either the Israelis or the Palestinians had budged from previous core positions. Speculation about its terms is “conjecture” because “the people who know the facts are not talking about them,” he said.

Netanyahu hasn’t agreed to Palestinian demands to suspend settlement construction or declare that the final accord on borders will be based on Israel’s lines before 1967, said Israeli Minister of International Relations Yuval Steinitz. The Palestinians have committed to at least nine months of negotiation, during which they will not undertake punitive diplomatic actions against Israel in the international arena, he told Israel Radio.

Steinitz said his government had agreed to free an unspecified number of long-serving Palestinian prisoners who had committed serious offenses against Israelis. Deputy Defense Minister Danny Danon, a member of Netanyahu’s own Likud party, opposed such a plan, saying “murderers must not be released as an ’act of good will’ or as a prize for returning to the negotiating table.”

Prisoner Release

Netanyahu will find it difficult to get cabinet approval, and even if he does, “it will cost him politically” because relatives of people killed in Palestinian attacks will mount a legal challenge, Gerald Steinberg, political science professor at Bar-Ilan University outside Tel Aviv, said in a phone interview.

Kerry said talks would be attended by Palestinian negotiator Saeb Erekat, Israeli Justice Minister Tzipi Livni and Netanyahu’s negotiator, Yitzhak Molcho.

“I’m sure with all my heart that it is the right thing to do for our future, our security, for the economy and Israel’s values,” Livni said yesterday on Facebook. “In the negotiating room, we will safeguard the national interests and security of Israel as a Jewish and democratic state. To this I am committed.”

Hamas denounced the planned talks. It “only serves the occupation and gives it a cover for its settlement expansion,” Hamas spokesman Sami Abu Zuhri said yesterday in an e-mailed statement.

Hamas, considered a terrorist organization by Israel, the U.S. and European Union, ousted Abbas’s forces from Gaza in 2007, a year after winning parliamentary elections.

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