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Fox News Sunday Transcript:

"Mr. Prime minister, thank you. Nice to have you with us.

Can you tell us how much of your --

BENJAMIN NETANYAHU, ISRAELI PRIME MINISTER: Thank you. I wish it could be under other circumstances.

HUME: Understood. Can you tell us how much of your mission you have accomplished so far, what the strikes that you have mounted have accomplished so far, in your judgment?

NETANYAHU: Well, first let me say what the mission is. Our mission is to restore a sustainable quiet, a sustainable security to our people by seriously degrading Hamas and other terrorist groups' capabilities in Gaza. I think we're proceeding and we'll continue until that goal is achieved. HUME: How much of it is achieved, sir, in your judgment so far?

NETANYAHU: Well, I'll leave that to the discussion of our inner cabinet and our general staff. But I think the important thing to understand is that we can't enable our population to be under continuous rocket fire. I mean, I just want your viewers to imagine the United States being bombarded not in one city or two cities, but in every city between New York and Colorado. Maybe 20 percent of the United States would be exempt from this, 80 percent of your citizens would have to be in bomb shelters or ready to go into bomb shelters within a minute to a minute and a half max.

You can't -- no country can accept that, we can't accept it, and we'll take the necessary actions to stop it.

HUME: There seems to be very little disagreement about that here in this country, Mr. Prime Minister. But obviously, there's concern that a conflict like this can have unintended consequences, and people I think are wondering whether you are nearer the beginning of this offensive or near the end of it. Can you give us an assessment of that?

NETANYAHU: Well, whether we're at the beginning of the end or end of the beginning, I'm not going to tell you right now, because we face a very, very brutal terrorist enemy.

I mean, you know, here's the difference between us. We are using missile defense to protect our civilians, and they're using their civilians to protect their missiles. That's basically the difference. They're embedding these rockets that they're firing wholesale into our cities, terrorist rocketing, trying to kill as many as they can.

They're not succeeding because of two reasons. One is because we've developed this incredible missile defense system, which I think is a historic development in the history of defensive warfare, with U.S. help -- and I want to thank the American people, President Obama, the U.S. Congress, for helping us fund this amazing development.

But the other reason we're succeeding, you have to understand some of the rockets do pierce through this shield. The reason we're succeeding is also because we're targeting the rocketeers. The rocketeers are firing from homes, these homes are actually command posts of the Hamas and Islamic jihad army. So, that's where they have their secure communications, weapon caches, rockets hidden, map rooms, so on. These are the command posts.

Obviously, we're not going to give them immunity. So, we have to attack them and we try to minimize as we can civilian casualties.

But with this kind of enemy, we'll take whatever necessary means that we need to take. I tell you, Brit, we've tried surgical action. We're not indiscriminate. It's very tough. There will always going to be civilian casualties, which we regret, but we have to defend our people. And that's what we'll do.

HUME: How likely is it that you will need to mount a ground invasion to accomplish the mission you have described?

NETANYAHU: We'll take the means necessary. You know, if this can be achieved through diplomatic or military means, whatever military means, we'll do what is necessary and what any country would do, what the United States would do, what Britain would do, what France would do. Many, many other countries understand this.

I have spoken to President Obama and great -- and a good number of world leaders, and I think they all understand Israel's inherent right of self-defense, the fact that the attacks are unconscionable, that fact that they're rocketing our cities is something that no country should agree with -- and I'm not going to get into the specifics of our operational response. I assure you -- I assure you that we have an operational response.

HUME: Understood.

Let me turn to the subject of Iran, which I know is of enormous concern to you. Iran's foreign minister was saying today on another broadcast, quote, "We don't see," said Mohammad Javad Zarif, "any benefit in Iran developing a nuclear weapon." And he went on to say it's simply not happening and so on. I think I know what your reaction to that would be, but let's hear it from you.

NETANYAHU: It's a joke. Of course, they're developing nuclear weapons. They invested, not billions. You can start counting it in maybe in hundreds of billions of dollars for what, for creating medical isotopes for Iranian patients circling the Earth? What are they developing ICBMs for if not for nuclear warheads? What are they developing these -- building these enormous underground nuclear facilities if not for nuclear weapons?

If they wanted to have just civilian nuclear energy, they could have it without centrifuges for enrichment, without plutonium and the heavy water. These are only use for nuclear weapons.

So, this is a sham. I mean, I don't think anybody could take this seriously.

I think we have to remember, this is the same Iran that is arming, financing, training Hamas and Islamic jihad. This is the preeminent terrorist empire of our time -- not even a terrorist state. It's a terrorist empire. It's got these terror provinces.

You don't want this Iran to have neither nuclear weapons, or the capability to make nuclear weapons, to enrich uranium for a nuclear bomb in short order, in a few weeks or a few months. They could do that unless that's changed.

I think it's possible to stop them, Brit. I think the important thing is to replicate the Syrian deal, where the capability to make the weapons was actually dismantled and removed from the soil of Syria. The same should happen in --

HUME: We're about, what, eight days now from the deadline for the U.S. and its partners to reach a deal with Iran to try to dismantle its nuclear weapons program. The situation looks pretty bleak as of now. Your assessment of that and whether any -- you can see the outlines of any deal that would be acceptable to you?

NETANYAHU: Well, look, Brit, I think a bad deal is actually worse than no deal. And I can tell you what a bad deal would be and I'll tell you what a good deal would be.

A bad deal would be that Iran gets to keep its enriched nuclear material and the capacity to enrich further to make a bomb. And put inspectors there, leave them with the capability, put inspectors there, trust them not to break up. I think that's a terrible deal.

A good deal is what was achieved under President Obama, the United States cooperating with Russia in the case of Syria. They didn't tell Assad there, OK, you can keep your chemicals and the means to convert these chemicals into chemical weapons, and we'll inspect. That's what the Iranians are suggesting.

HUME: How --

NETANYAHU: But that's not the deal in Syria was. The deal was you dismantle these materials and these capabilities and you ship them out of Syria. That's a good deal.

HUME: Got it. How likely --

NETANYAHU: That deal would be good.

HUME: How likely --

NETANYAHU: And if you can get it, do it. If you can't get it, don't make a bad deal.

HUME: How likely is it, given what you know of the negotiations, that the kind of bad deal that you described may be what emerges here?

NETANYAHU: I certainly hope that doesn't happen because I think it would be a catastrophic development, because you know the Middle East is in turmoil, everything is topsy-turvy. The worst militants, Shiites and Sunni radicals, are vying with each other who will be the king of this Islamist hill. And from there, they'll go on and attack the United States, whom they see as the Great Satan.

We're in this case only as your appendage in their eyes. And in a certain sense they're right. We're a part of that same hated civilization of freedom that they despise so much.

But if any one of these sides, and in this case, the militant Shiites led by Iran, get their hands on nuclear weapons, and all bets are off.

I think the Middle East would -- many nations would rush to have their own nuclear weapons here, I think these people who support terrorists would now have a nuclear weapon shield. It would be a disaster for the United States and for everyone else.

HUME: Mr. Prime Minister, thank you very much, sir.

NETANYANU: I hope it doesn't happen. I'm working so it doesn't happen.

HUME: Understood. Thank you, sir.

NETANYANU: Thank you, Brit. Thank you."