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Israeli PM backs Palestinian state

Israeli Prime Minister Benjamin Netanyahu will, for the first time, endorse the notion of a Palestinian state alongside Israel, senior aides have said.

The decision to drop his long-standing opposition to Palestinian independence follows growing pressure from the US.

However, Mr Netanyahu will demand the Palestinians agree not to have an army and recognise Israel as the Jewish state - a condition widely seen as forcing Palestinian refugees to give up their dream of returning to lost properties in Israel.

"He will call for a Palestinian state without an army, side by side with the Israeli state," said Mr Netanyahu's press secretary, Nir Hefetz.

It was not clear whether Mr Netanyahu's conditions would be acceptable to the Palestinians. In particular, they have objected to recognising Israel as a Jewish state, saying it would amount to giving up the rights of millions of refugees and be discriminatory to Israel's own Arab minority.

It also was not known how much captured land Mr Netanyahu would be willing to cede to Palestinian control. The Palestinians demand all of the West Bank as part of a future state, with east Jerusalem as their capital. Israel captured both areas in the 1967 Mideast war.

Mr Netanyahu, leader of the hard-line Likud Party, has historically opposed withdrawing from the lands, for both security and ideological reasons. Mr Netanyahu has said he fears that Palestinian militants will use the West Bank to stage attacks on Israel, much the way Hamas militants in the Gaza Strip have fired thousands of rockets into Israel since it withdrew from that territory in 2005.

Despite all the uncertainty, his support for a Palestinian state would mark a major change of heart for the hard-line Israeli leader, who has been caught between American demands for him to begin peace talks with the Palestinians and the constraints of a hard-line coalition.

Israeli TV stations speculated that Mr Netanyahu would reach out to the moderate Kadima Party, if his current coalition falls apart because of hard-line opposition.

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