WASHINGTON (Reuters) - Israel must seek peace with the Palestinians that will entail "painful compromises" including the handover of biblical land dear to Jews, Prime Minister Benjamin Netanyahu said on Tuesday.
Addressing the U.S. Congress after a testy exchange last week with President Barack Obama about the contours of a future Palestine state, the right-wing Israeli leader reiterated Israel's terms for permanent accord.
"I am willing to make painful compromises to achieve this historical peace. As the leader of Israel, it is my responsibility," he said.
"Now, this is not easy for me. It's not easy, because I recognise that in a genuine peace we will be required to give up parts of the ancestral Jewish homeland," he said, referring to the occupied West Bank.
Though he implied Israel would cede some of its Jewish settlements there, Netanyahu said other settlements would be annexed as the new border would not return to lines held before the West Bank's capture in the 1967 Middle East war.
"This compromise must reflect the dramatic demographic changes that have occurred since 1967," he said, his speech repeatedly interrupted by loud applause.
Senior Palestinians swiftly rejected his vision for ending the decades-old conflict.
"What came in Netanyahu's speech will not lead to peace," Nabil Abu Rdainah, the spokesman for President Mahmoud Abbas, told Reuters in the West Bank.
Netanyahu said Israel was prepared to be "generous" about the scope of the future Palestine, but it would have to be demilitarized and accept a long-term Israeli military presence in the Jordan Valley, Netanyahu said.
He also called on Palestinians to see their future "homeland," rather than Israel, as the place to settle refugees from the 1948 war that found the Jewish state whose national identity is still challenged by many Arabs.
"It's time for President Abbas to stand before his people and say, 'I will accept a Jewish state'," Netanyahu said to applause.
"Those six words will change history. They will make it clear to the Palestinians that this conflict will come to an end," he said. "And those six words will convince the people of Israel that they have a true partner for peace."
Netanyahu also urged Abbas to back out of a power-share deal signed this month with rival Palestinian Islamist group Hamas, which opposes peacemaking, and to shelve a campaign to secure statehood status for Palestine at September's United Nations General Assembly.
"Tear up your pact with Hamas and sit down and negotiate, make peace with the Jewish state," he said.
"The Palestinian attempt to impose a settlement through the United Nations will not bring peace, it should be forcefully opposed by all those who want to see this conflict end," he said. "Peace cannot be imposed, it must be negotiated."
Editing by Doina Chiacu