Israeli says deal possible, difficult

JERUSALEM - Staking out his starting position for new Mideast peace talks, Israel's prime minister demanded Sunday that any future Palestinian state be demilitarized and recognize Israel as the Jewish homeland.

Benjamin Netanyahu said reaching a deal would be "difficult, but possible."

The conditions he laid down, coupled with a swift Palestinian rejection, illustrated just how difficult the task will be for the United States to meet its goal of brokering peace within a year. Talks are set to begin in Washington next week.

"We want to surprise all of the critics and skeptics. But to do that we need a real partner on the Palestinian side," Netanyahu told his cabinet. "If we discover that we have such a partner, we will be able to quickly reach a historic agreement between the two peoples."

In his first public comments since the White House announced the planned resumption of talks Friday, Netanyahu said any future Palestinian state would not be allowed to have an army, would have to recognize Israel as a Jewish state, and would have to accept other Israeli security demands.

He did not address what are considered the thorniest issues: borders, the status of Jerusalem, and the fate of the Palestinian refugees.

He will be negotiating with the Palestine Liberation Organization, which holds sway only in the West Bank, the territory squeezed between Israel and the Jordan River. The PLO wants a state in all of the West Bank, neighboring east Jerusalem, and the seaside Gaza Strip on the other side of Israel.

Gaza is ruled by the Islamic extremist group Hamas, which refuses to recognize Israel.

In the past, Netanyahu has said Israel will have to maintain a security presence along the West Bank's border with Jordan to prevent arms smuggling, and that east Jerusalem, the sector of the holy city claimed by the Palestinians as their capital, must remain under Israeli control.

His Likud Party is also a champion of the four-decade-old movement to settle Jews in the West Bank, which Israel captured along with east Jerusalem and Gaza in the 1967 Mideast war, though it withdrew from Gaza in 2005.

The Palestinians have long rejected Netanyahu's demands. They say recognizing Israel as a Jewish state would threaten the status of Israel's Arab minority and undermine the rights of Palestinian refugees whose families lost homes during Israel's creation in 1948.

Palestinian negotiator Saeb Erekat said Netanyahu's comments were "dictation, not negotiation."

During nearly two decades of failed negotiations, previous Israeli governments have offered broad withdrawals from nearly all of the West Bank. But talks have bogged down over the extent of the withdrawal and the issues of refugees and Jerusalem.

Netanyahu's predecessor, Ehud Olmert, who left office last year, proposed a withdrawal from nearly all of the West Bank, offered to turn over parts of east Jerusalem to Palestinian sovereignty and agreed to a symbolic return of some Palestinian refugees to what is now Israel.

Olmert's talks with the Palestinians broke down, however, after Israel launched a war against Hamas in the Gaza Strip in December 2008. Netanyahu was subsequently elected, and talks have been on hold since then.

Something close to the Olmert proposal - including a Palestinian presence in east Jerusalem and a near-complete withdrawal from the West Bank - is widely seen as the basis for a settlement.

But Netanyahu, who leads a coalition dominated by hard-line nationalistic and religious parties, has signaled he is not willing to go that far.

He pointedly insisted that there be no preconditions for him to rejoin the peace talks, and his aides have given no details about what concessions he is prepared to make.

In a key test, an Israeli slowdown on settlement construction in the West Bank is set to expire next month, and some of the coalition's hawkish members have said the government's stability will be threatened if construction does not resume in full.

On the other hand, Erekat, the Palestinian negotiator, said that if the slowdown ends, Israel "will have closed the door to negotiation."

The Western-backed Palestinian Authority government led by President Mahmoud Abbas in the West Bank resisted direct peace talks with Netanyahu for months, fearing they would not be productive. It agreed under heavy U.S. diplomatic pressure.

With the gaps so wide, expectations are low all around. Israeli and Palestinian newspapers greeted news of the new talks with pessimism Sunday, and one leading Israeli newspaper, Maariv, buried its report on Page 10.

Looming over the talks is control of Gaza by Hamas. The Iranian-backed group, which won elections in Gaza in 2006 and the next year ousted the PLO from there, has condemned the talks. It is unclear how any peace deal would be implemented as long as Hamas rules one of the two areas claimed by the Palestinians.