10 October 2010 Last updated at 10:38 ET

Israeli cabinet backs controversial Jewish loyalty oath

Foreign Minister Avigdor Lieberman has supported the proposal

The Israeli cabinet has approved a controversial bill that would require all non-Jews taking Israeli citizenship to swear loyalty to Israel as a "Jewish and democratic state".

The law, which has angered Israel's Arab minority, still has to be passed by the Knesset, the Israeli parliament.

A similar measure was rejected by the cabinet in May 2009.

If approved, the new law will affect a small number of non-Jews who seek Israeli citizenship.

Correspondents say it will mainly apply to Palestinians married to Israelis who seek citizenship on the basis of family re-unification, foreign workers, and a few other special cases.

Arabs make up 20% of Israel's population.

The proposal, which is being backed by Prime Minister Benjamin Netanyahu, had been welcomed by right-wing ministers in the 30-member coalition cabinet, including ultra-nationalist Foreign Minister Avigdor Lieberman.

Mr Lieberman's Yisrael Beitenu party made the oath the centrepiece of its campaign in the 2009 election, which eventually led to it becoming the second largest member of the governing coalition after Mr Netanyahu's Likud.

Pay-off demand

Israeli media reported that all five ministers from the left-leaning Labour party voted against the proposal, as did three members of Netanyahu's own Likud.

Before the vote, Labour ministers had said they expected a new freeze on settlement building as a pay-off should the law come into effect.

This is a key Palestinian demand in the current peace talks.

Proposed citizenship oath

• New wording: "I swear that I will be a loyal citizen to the state of Israel, as a Jewish and democratic state, and will uphold its laws."
• Mainly affects Palestinians married to Israelis, foreign workers, and other special cases where people seek to be naturalised as citizens
• Does not affect people of Jewish ancestry and their spouses who have the right to settle in Israel and gain citizenship under the law of return

But both Mr Netanyahu and Yisrael Beitenu denied any deal involving an extension of the partial settlement freeze on Jewish settlements in the West Bank.

The recently renewed peace talks are at risk of collapse over ongoing Jewish settlement building in the occupied West Bank, with the Palestinians threatening to walk out unless the freeze is reinstated.

Recognition of Israel as a Jewish state is one of Israel's key demands in any eventual peace deal with the Palestinians.

To that end, Mr Netanyahu has rejected the right of return of Palestinian refugees, calling it a device to destroy the state of Israel by demography.

The Palestinians, in the form of the Palestinian Authority, have agreed to recognise Israel as a state, but have rejected the demand to recognise its Jewish character.

Also, the issue of requiring some citizens - mainly Israeli Arabs - to swear allegiance to a Jewish state has proved deeply divisive within Israeli society.

In proposing the requirement, right-wing parties had focused on perceived disloyalty among Israeli Arabs, drawing widespread criticism as well as support.