WASHINGTON - The U.S. Senate version of the Foreign Aid legislation for 2008 includes a clause that would restrict Israel's ability to use American military aid to purchase cluster bombs, in the wake of Israel's controversial use of the deadly weapon in the Second Lebanon War.

The Senate Appropriations Committee voted in favor of the bill late last week. Read the full story on Rosner's Domain.

Israel's use of cluster bombs during last year's Second Lebanon War was highly criticized by human rights organizations, and the U.S. has opened an investigation into whether Israel breached its agreement with the U.S. over the circumstances under which it is permitted to use the weapon.

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Information presented to the U.S. by the Foreign Ministry indicates that Israel did indeed violate the agreement. According to the United Nations demining unit, 30 civilians have been killed and 180 wounded by unexploded bomblets since the cease-fire went into effect.

During the war, Israel made use of American-made cluster bombs that left behind thousands of unexploded bomblets, even though Israel Military Industries produces cluster bombs that leave nearly no unexploded munitions.

The main reason for the use of the U.S.-made weapons: Israel uses American military aid funds to purchase cluster bombs from the U.S., and in order to buy IMI-made bombs, the Israel Defense Forces would have to dip into its own budget.

"The consideration is budgetary," a defense related source said. However, each IMI-made cluster bomblet costs a mere $10.

In the 1990s, following injuries to Israeli soldiers by unexploded clusters, a decision was made to develop better munitions at IMI. According to globalsecurity.org, the rate of duds in cluster bomblets made by IMI ranges from 0.2 percent to 1 percent - compared to between 30 and 40 percent in the American-made weapons.

To date IMI has manufactured some 60 million such bomblets, designated M85, and has exported them to many armies throughout the world.

The foreign aid clause, sponsored by Senators Patrick Leahy and Dianne Feinstein, would restrict the sale or transfer of cluster bombs such that no military funds will be used for such bombs unless "the cluster bombs have a failure rate of one percent or less."

The clause also states that "the sale or transfer agreement specifies that the cluster bombs will be used only against clearly defined military targets and not where civilians are known to be present."

The clause, however, is absent from the version passed by the House of Representatives. Therefore, should the Senate pass its current version, a joint committee will decide whether the clause remains in the version of the bill that is sent to President George W. Bush for his signature.

The U.S. imposed a ban on the sale of cluster bombs to Israel in the 1980s, after a congressional inquiry found that Israel used the ammunition during the first Lebanon War. That ban remained in effect for six years.

Haaretz has also learned that Leahy, who chairs the State-Foreign Operations Appropriations subcommittee, tried last week to downgrade American aid to Israel by changing the language of the bill - for instance by replacing every reference from "Israel shall receive aid" to "Israel should."

Leahy ultimately failed when other members of the committee told him the changes he introduced were unacceptable to them.