The offer, which emerged tonight appeared to represent a major climb-down by
Mr Netanyahu, who has consistently refused to discuss specific borders of a
future state.
A government official in Jerusalem told The Daily Telegraph the offer was
dependent on the Palestinians dropping their campaign for statehood at the
United Nations next month and accepting Israel as a Jewish state.
The offer appears to cross Palestinian red lines, and it seemed likely to be
rejected - although the onus is now likely to be placed on the Palestinians
to present a counter offer.
Mr Netanyahu reacted angrily when the 1967 proposal was made by Barack Obama
in May but was now said to be offering to trade Israeli territory on its
side of the line for West Bank land where its main settlements were located.
"We are willing in a framework of restarting the peace talks to accept a
proposal that would contain elements that would be difficult for Israel and
we would find very difficult to endorse," said an official, answering a
question about the Obama proposal.
The Palestinians said they had not received a proposal from Israel.
They have demanded that Israel stop construction in its West Bank settlements
and east Jerusalem before peace talks resume. Mr Netanyahu was said to have
wanted talks with no preconditions where issues such as settlements and
borders would be discussed.
The ceasefire line dates from June 1967, when Israel captured the West Bank,
Gaza Strip and east Jerusalem.
