Even in peace Iran will hate

TZIPI Livni, Israel's Foreign Minister, wants the world to know that if peace is not reached between Israel and the Palestinians, it will not be because the Israeli Government is unwilling to take risks or make painful concessions.

I meet Livni on Thursday in her Tel Aviv office for a rare exclusive interview. It is the day after the first session of negotiations between Israel and the Palestinians as part of the Annapolis peace process.

She is, understandably, a little late for our appointment and at first seems a bit stressed, rushing her words, interrupting her own sentences.

But who in the world has more of a right to be stressed than the Israeli Foreign Minister? It takes only a few minutes for her to settle into the interview and her tone becomes determined but realistic.

She and her Prime Minister, Ehud Olmert, are going to give the Annapolis peace effort their best shot.

"We need the international community to understand we've passed the period when our international image is that we are trying to gain more time, to gain more control over the (Palestinian) territories," she says.

"At the same time, we can't just throw the keys to the other side if there's no one responsible there."

The Annapolis process calls for an agreement between Israel and the Palestinians on the core issues within a year. These core issues include the boundaries of a Palestinian state, the status or possible division of Jerusalem, the fate of Palestinian refugees and their dependents, and the future of Jewish settlements in the West Bank.

The process also requires the implementation of the road map, which means the Palestinian Authority putting an end to terrorism against Israel and implies the PA retaking authority over the Gaza Strip from Hamas.

All of this looks not so much a tall order as an impossible dream. But most analysts agree that so long as expectations are not unrealistic, it is better for the two sides to be talking than not.

At the same time, Israel, with the backing of the international donors' conference in Paris on Monday, of which Australia will be part, will try to improve the quality of life for ordinary Palestinians in the West Bank.

For all that, the first day of talks, which Livni as her Government's chief negotiator led on the Israeli side, were tense and difficult. But no one said they would be easy.

"In the Middle East it's not a matter of days," Livni says. "I don't describe my views as optimistic or pessimistic. There's a goal to reach: the vision of two states for two peoples.

"We are serious. We know what kind of concessions we are willing to make. I don't know yet if the Palestinians really understand the true meaning of two states for two peoples."

Livni offers one example in particular. This is the so-called right of return, the right for all Palestinians who once lived in Israel and all their descendants to return to Israel rather than to a new Palestinian state.

"The creation of Israel as a Jewish state according to a UN resolution was to end a conflict in the land of Israel, or the land of Palestine, whatever you want to call it, between Jews and Arabs," Livni says.

"The idea was to create states to give meaning to the national aspirations of the two peoples. The Palestinians are demanding a Palestinian state but also demanding the right of return of Palestinian refugees to Israel. This is against the nature of two states. Israel cannot be part of the solution for these refugees because the creation of the Palestinian state is the only solution to their national aspirations."

It is fair to say that this is not even the most difficult issue the two sides face as no one seriously expects Israel to embrace its annihilation as a Jewish state by embracing several million new Palestinians. Livni instead identifies what many see as the crucial issue: "Nobody wants to create a terror state and Israel cannot afford it. The question is less about the territorial concessions needed from Israel and more about whether we can achieve security - I don't even use the word peace - in terms of the West Bank, and Gaza, which is now controlled by Hamas. We believe the two-state solution is the best option and in the Middle East you have to choose between bad options."

But if you talk to many Israelis, they place the Palestinian question, intractable as it is, second to a much bigger threat: a nuclear-armed Iran.

I ask Livni whether she believes the Iranians are working towards a nuclear weapon. Her response is unequivocal: "The clear, simple answer is yes."

Israeli government leaders have been publicly polite and privately bewildered by the bizarre US intelligence report that concludes that Iran has stopped its nuclear weapons program.

Significantly, Livni agrees that the US report has made more difficult the international campaign to mount effective sanctions against Iran over its illegal uranium enrichment program. However, she says, she does not know why the US released that report the way it did. Nor will she speculate on it.

Without revealing any classified information, Livni makes an irrefutable case that Iran is pursuing nuclear weapons, based on the evidence contained within the report.

"In a strange way, saying the Iranians stopped their nuclear activity towards this goal in 2003 also is evidence of what they actually want to reach," she says. "Now, it's a matter of one plus one equals two. The Iranians continue the uranium enrichment in violation of the (UN) Security Council resolution and in violation of the non-proliferation treaty.

"They're talking in violent terms even though they could easily work with the international community if their intentions would have been only civil or energy for useful purposes.

"The problem with Iran is partly ideology. It's not a political vision, in reference to Israel, it's only an excuse. The way they see their destiny is to change the region. These Shia extreme Islamic ideas, they transcend borders and affect neighbours.

"It (Iran) is not a state that only wants a weapon for self-defence or to become a regional player; they really act. They act in Lebanon through Hezbollah. They act in the Palestinian territory supporting Hamas and other terrorist organisations in terms of weapons, money and training. They work with radical elements in other Gulf states. Most Arab leaders, they understand better than the Western world the meaning of this ideology. This is a combination that is the most risky: in a national conflict, or a conflict on borders, you can reach an understanding, but this conflict is a conflict of ideology.

"Their ideology is to deprive others of their rights. This is the nature of the threat and I'm not sure that other parts of the world understand it because usually we judge the other according to our own values and this is totally different. I don't think they (the West) really understand the nature of the threats in terms of their own interests.

"Let's imagine that the Israel-Palestine conflict will be solved today. It won't change Iran's ideology. Their ideology is not connected to Israel."

Like most senior Israeli politicians and officials, Livni followed Australia's election. Olmert phoned Kevin Rudd to offer congratulations. Senior Israelis appreciate that Rudd is a friend of Israel, strong on terror and solidly committed to the US alliance.

At the same time they are deeply appreciative of the support the Howard government gave them during the past 12 years. Olmert also rang John Howard and former foreign minister Alexander Downer, not only to thank them for this support but to tell them Israel will always regard them as friends.

Livni says Australia's support is important to Israel: "I believe it is about friendship, but it is also about values. We need to know there are places in which Israel is understood.

"It's not only a matter of Israel's interests or supporting Israel but supporting the interests of the free world. We believe we are in the front line representing the interests of the free world in the region."

Referring to Australia, Livni says: "When you see the kind of leaders that can see straight and have this understanding between what is right and what is wrong, it is immensely important."

Livni is not quite the charismatic charmer that her American counterpart Condoleezza Rice is, but if anything she has the tougher job. Every day is full of life and death decisions. And in that life and death struggle she thinks of Australia as a friend.