Prime Minister Benjamin Netanyahu
Prime Minister Benjamin Netanyahu at a meeting of the Conference of Presidents of Major American Jewish Organizations in New York on July 8, 2010. Photo by Reuters
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NEW YORK - Prime Minister Benjamin Netanyahu told the Council on Foreign Relations in New York on Thursday that if direct negotiations between Israel and the Palestinian Authority begin, it would be possible to reach a peace deal within a year.

In his speech to the prestigious foreign-policy think tank, Netanyahu stressed that he did not return to the post of prime minister in order to do nothing and said he was willing to make unprecedented concessions.

One participant asked him whether direct talks with PA President Mahmoud Abbas, with U.S. President Barack Obama serving as mediator, would lead to an agreement within a year. "Yes, I think so," Netanyahu said.

When asked whether the freeze on settlement construction was likely to be extended, he avoided a clear answer. As in previous cases where he has been asked about this issue in recent weeks, his response could be interpreted as an intention either to build or to freeze.

"I did the temporary freeze as an incentive for the Palestinians to enter direct talks," Netanyahu said. "Now, seven months into the freeze, the Palestinians have not entered direct talks, and they already want to extend it. The right thing to do is to enter talks. We have shown good will ... I think we have done enough, let us move onto direct talks."

Netanyahu said security and legitimacy are the two essential components of real peace in the Middle East. He said there should be "two states for two peoples," but Israel's security must be guaranteed, and a "demilitarized Palestinian state must recognize the State of Israel."

During a separate interview with Larry King, Netanyahu was asked about his meeting with Obama.

"I think there's an underlying relationship there that people don't appreciate," he replied. "We have our ups and downs. People focus on the downs and the downs are exaggerated and sometimes distorted. But there [are] ups and there's a basic bedrock of identification, common values between Israel and the United States. I think there is a solidity of ties between Israel and the United States that the president of the United States and the prime minister of Israel reflect in their meeting."

Netanyahu used the interview to again urge Abbas to "meet me and let's talk peace."

"I use this forum today to say, President Abbas, meet me, and let's talk peace. We all have our grievances. We all have our, you know, our questions and things that we want answered. But the most important thing is to get together, sit down in a room and begin to negotiate peace. You cannot resolve a conflict, you cannot successfully complete a peace negotiation if you don't start it. And I say let's start it right now, today, tomorrow, in Jerusalem, in Ramallah or anywhere else. I'm prepared to go to a warm city like New York or a cool city anywhere. Let's get on with the business of talking peace and concluding the peace agreement."

Asked whether he would be willing to talk with Hamas, Netanyahu said he was willing to "sit down with anyone who will recognize my existence. Somebody who calls for our destruction, my destruction, is unfortunately not a partner for peace."

On the crisis with Turkey, Netanyahu said that "the relationship began to deteriorate with the Turkish policy, a new policy, that basically veers away from the West and I think Israel - what has happened with Israel [is] a result of that policy and not its cause.

"But nevertheless, I look for every opportunity to see if we can stop this deterioration and somehow get things back to normal or relatively normal. Last week, I authorized a meeting with one of my senior ministers and the Turkish foreign minister. They met in Zurich, in the airport. I can't tell you that something positive came out of it."