Prime Minister Benjamin Netanyahu called on Wednesday for "bolstering Israel's might" in response to the turmoil unfolding in Egypt, while at the same seeking to pursue peace efforts with the Palestinians.
In a speech to Parliament, Netanyahu reiterated Israel's concerns that any regime that followed that of President Hosni Mubarak may follow a radical Islamist line, though Israel stood by protesters' calls for democratic reform.
"The basis of our stability, our future and for maintaining peace or widening it, particularly in unstable times, this basis lies in bolstering Israel's might," he added, in his toughest response yet to the week of protests in Egypt.
The remark appeared to suggest Israel may need to expand its armed forces if a 1979 peace treaty with Egypt, Israel's first with an Arab nation, failed to survive the unrest or seemed less durable than in the past.
The peace with Egypt created a peaceful border with a nation that was once Israel's largest Arab foe. Netanyahu said he hoped world leaders would ensure that Egypt stuck by that deal.
The treaty with Egypt has enabled Israel to scale back military expenditure considerably. Security expenditure is currently about 9 percent of GDP, down from 30 percent in the years just before the treaty with Egypt was signed.
Dan Schueftan, a strategic expert at the University of Haifa, said in an interview that the uncertainty in Cairo, which could last for months, meant Israel might need to build "a much stronger army and increase the defence budget in a major way."
Turning to Israel's Palestinian neighbours, Netanyahu urged President Mahmoud Abbas to seize what he saw as an opportunity created by the unrest in Egypt, to renew stalled peace talks.
At the same time, Netanyahu said that gaps in both sides' positions were possibly "too wide to bridge" to conclude a deal.
The U.S.-brokered talks with Palestinians broke off in September in a dispute over Jewish settlement building on land Israel captured in a 1967 war which Palestinians want for a state. (Writing by Allyn Fisher-Ilan; Editing by Jon Boyle) (allyn.fisher.thomsonreuters.com; +972-2-6322202; Reuters Messaging:email@example.com))
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