Israel is currently a democratic nation with Jewish majority. At the current birthrates the Israel Arabs will be come the majority in about 45 years or 60 years til voting majority since many would be children. The Right or return for ex-Arabs would also change the majority of Israel but what about the their land titles from Ottoman/British which under the "A" Mandates the state of Israel agreed it would honor but declared them abandon and became state lands after many Arabs temporary fled to escape the war but not allowed to return. The "A" Mandates gave Jews the Right of return and a path to statehood but not the land titles, which they would need to buy the land or find away to take it. Israel would have problems calling itself a "Jewish State" but if they get the PA to do it for them in helps remove many legal issues. Israel is in a legal minefield on many international laws with few direct options but the US has helped Israel to get around or block most of them.
Israeli woman, 65, stabbed in Bedouin town of Rahat (Haaretz)
from the article: Netanyahu: No peace until Palestinians accept Israel as Jewish state