Israeli Prime Minister Calls For Creation Of Limited Palestinian State

JERUSALEM — Israeli Prime Minister Benjamin Netanyahu endorsed a Palestinian state beside Israel for the first time on Sunday, reversing himself under U.S. pressure but attaching conditions such as having no army that the Palestinians swiftly rejected.
A week after President Barack Obama's address to the Muslim world, Netanyahu said the Palestinian state would also have to recognize Israel as the Jewish state _ essentially saying Palestinian refugees must give up the goal of returning to Israel.
With those conditions, he said, he could accept "a demilitarized Palestinian state alongside the Jewish state."
The West Bank-based Palestinian government dismissed the proposal.
"Netanyahu's speech closed the door to permanent status negotiations," senior Palestinian official Saeb Erekat said. "We ask the world not to be fooled by his use of the term Palestinian state because he qualified it. He declared Jerusalem the capital of Israel, said refugees would not be negotiated and that settlements would remain."
Netanyahu, in an address seen as his response to Obama, refused to heed the U.S. call for an immediate freeze of construction on lands Palestinians claim for their future state. He also said the holy city of Jerusalem must remain under Israeli sovereignty. LinkHere