Anybody surprised? The Palestinians will accept only an Islamic state. They want Israel gone.

John Kerry fustrated by Palestinians' refusal to recognise 'Jewish' Israel

Disagreement over Israel's status as a Jewish state threaten to torpedo US-brokered peace talks with the Palestinians

Demands that the Palestinians recognise Israel as a Jewish state have become a major stumbling block in John Kerry’s search for a settlement to the Middle East’s most enduring conflict.

As the US secretary of state continued a frantic diplomatic quest on Sunday that some have dubbed “mission impossible”, Benjamin Netanyahu, the Israeli prime minister, said Palestinians’ refusal to formally acknowledge the country’s Jewish character had become the key topic in his discussions with Mr Kerry.

Palestinian officials admitted that Mr Kerry has pressed the issue with Mahmoud Abbas, the Palestinian Authority president, who has so far refused to bend.

“The Americans have made it very clear that [recognition of Israel as a Jewish state] is their position,” one Palestinian official told The Daily Telegraph. “They talk about it in meetings with our side and make an issue out of it. We have made it very clear that we are not going to sign any agreement that recognises Israel as a Jewish state.”

The Palestinian leader believes the rights of Israel’s approximately 1.5 million Arab citizens would be undermined if he concedes the point. It would also weaken the claims of around 5 million refugees and their descendants claiming a “right of return” to homes that are now in Israel, Palestinians argue.T2013

Yasser Arafat, the late Palestinian leader, officially recognised Israel before signing the Oslo accords in1993 in a letter to Yitzhak Rabin, the then Israeli prime minister, but did not mention its status as a Jewish state.

Mr Kerry left Israel on Sunday for Jordan and Saudi Arabia, where he was thought to be seeking support for possible Palestinian concessions. Mr Abbas is thought to be unlikely to give way on key issues without wider Arab support.

Mr Netanyahu - who was reported to have launched an angry tirade cf complaints to Mr Kerry when the pair met last Thursday - linked the issue to what he said was a campaign of Palestinian incitement against Israel.

“The Palestinians are continuing their campaign of inciting hatred, as we have seen in the last few days with their refusal to recognise Israel as a state for the Jewish people,” he told Sunday’s cabinet meeting. “This is the main issue that we’re discussing with [Mr Kerry]. We are not foreigners in Jerusalem, Beit El [a West Bank settlement] or Hebron. I reiterate that, in my view, this is the root of both the conflict and the incitement - the non-recognition of this basic fact.”

Avigdor Lieberman, the Israeli foreign minister, told foreign diplomats on Sunday that he would refuse to accept any agreement that did not include territorial swaps. Such a move would effectively increase the proportion of Israel’s Jewish population by transferring predominantly Arab areas to a new Palestinian state.

Separately, an estimated 30,000 African asylum-seekers who entered Israel illegally staged a mass demonstration in Tel Aviv against a new law enabling the authorities to detain migrants indefinitely in a new “open” detention centre in the Negev.

Campaigners say 300 asylum seekers have been arrested since the Knesset, Israel’s parliament, passed the new “anti-infiltration” law three weeks ago.