Netanyahu takes U-turn on Palestine

Benjamin Netanyahu said Wednesday Israel wants peace with the Palestinians as he was tasked to form a government a week after saying they won't get a state if he is re-elected.

"Our hand is held out in peace to our Palestinian neighbours and the people of Israel know that real peace -- and our future -- will only be assured if Israel is strong," he said after his surprise victory in a March 17 election.

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As the Israeli premier works to build a new coalition government at home, he faces one of the worst confrontations in his stormy relationship with the White House.

He has tried to play down declarations he made during his recent victorious election campaign in which he ruled out the creation of a Palestinian state and stigmatized Arab voters.

But Obama has not let him off the hook and, after White House leaks accused Israel of spying on US-Iran nuclear talks, he insisted the allies have more tough talking ahead.

On Tuesday, US President Barack Obama said that his disagreement with Israel's Prime Minister Benjamin Netanyahu represents a substantial policy difference and not a personal vendetta.

"The issue is a very clear, substantive challenge," Obama told reporters at a joint White House news conference with Afghanistan's President Ashraf Ghani.

"We believe that two states is the best path forward for Israel's security, for Palestinian aspirations and for regional stability.

"That's our view and that continues to be our view. And Prime Minister Netanyahu has a different approach."

Since Netanyahu's party won Israel's March 17 election, not a day has passed without a US comment -- official or otherwise -- on the implications of his hardline rhetoric.

The United States -- a veto-wielding member of the UN Security Council -- has opposed moves at the United Nations to recognize a Palestinian state, saying that must be part of a negotiated peace deal.

It has also shielded Israel from often Arab-led UN votes castigating the Jewish state for various actions, including alleged human rights abuses. But now the United States said it would "reassess" its relationship with Israel.