Israeli Prime Minister Benjamin Netanyahu endorsed an independent Palestinian state beside Israel for the first time on Sunday, dramatically reversing himself in the face of U.S. pressure but attaching conditions the Palestinians swiftly rejected.

A week after President Barack Obama's address to the Muslim world, Netanyahu said the Palestinian state would have to be unarmed and recognize Israel as the Jewish state _ a condition amounting to Palestinian refugees giving up the goal of returning to Israel.

Netanyahu, in an address seen as his reponse to Obama, refused to heed the U.S. call for an immediate freeze of construction on lands Palestinians claim for their future state. He also said the holy city of Jerusalem must remain under Israeli sovereignty.

Senior Palestinian officials Saeb Erekat said the plan "closed the door" to negotiations.

Still, it was a dramatic transformation for a man raised on a fiercely nationalistic ideology and who has spent a two-decade political career criticizing peace efforts.

"I call on you, our Palestinian neighbors, and to the leadership of the Palestinian Authority: Let us begin peace negotiations immediately, without preconditions," he said, calling on the wider Arab world to work with him.

Since assuming office in March, Netanyahu has been caught between American demands to begin peace talks with the Palestinians and the constraints of a hardline coalition. With his speech, he appeared to favor Israel's all-important relationship with the U.S. at the risk of destabilizing his government.

Netanyahu laid out his vision in a half-hour speech broadcast nationwide during prime time. He spoke at Bar-Ilan University, known as a bastion of the Israeli right-wing establishment, and his call for establishing a Palestinian state was greeted with lukewarm applause.

[HuffingtonPost]