Israeli Deputy Foreign Minister Danny Ayalon met U.S. Rep. Nita Lowey, D-Calif., the chairwoman of the U.S. House Appropriations Committee’s Foreign Operations Subcommittee, on Thursday.

At that meeting, Mr. Ayalon asked Ms. Lowey to ensure the additional funds the United States is transferring to the Palestinians do not reach Hamas or other terrorist groups.

“We can not allow these funds to reach the hands of the terrorists,” Mr. Ayalon said. “This is vital.”

Ms. Lowey will have to cope with the fact that the Palestinian Authority continues to abide by the March 2007 Mecca agreement, which continues to obligate the PA to provide funding to the Hamas-controlled government in Gaza.

David Bedein can be reached at dbedein@israelbehindthenews.com

White House Chief of Staff Rahm Emanuel has made it clear to Israel that a permanent status arrangement must be reached with the Palestinians over the next few years – no matter what.

President Barack Obama’s chief of staff reportedly made his comments during a conversation with a Jewish leader in Washington, D.C., and his words have recently come to light in Israel.

“In the next four years, there is going to be a permanent status arrangement between Israel and the Palestinians on the basis of two states for two peoples, and it doesn’t matter to us at all who is prime minister,” Mr. Emanuel was quoted as having said.

Mr. Emanuel’s words have been publicized amid reports the Obama administration has also informed Israeli Prime Minister Benjamin Netanyahu that Mr. Obama will not be able to meet with him early next month during his scheduled appearance at the American Israel Political Action Committee’s (AIPAC) annual conference in Washington, D.C.

Mr. Netanyahu had hoped to capitalize on the opportunity and meet with Mr. Obama during the annual conference, but the Americans informed the Israelis that Mr. Obama was not going to be “in town.”

That being the case, Mr. Netanyahu’s aides hope to cancel his trip to attend the conference and try to secure a meeting with Mr. Obama later in May.

These actions come as the Obama administration has sharpened its rhetoric regarding negotiations between Israel and the Palestinians. The administration has told Mr. Netanyahu’s government that confronting Iran’s nuclear threat will be contingent on progress in the negotiations and an Israeli withdrawal from areas that it acquired in the 1967 Six-Day War.

Senior Obama administration officials are aware of how the prime minister and Israeli Defense Minister Ehud Barak have linked their willingness to achieve progress with the Palestinians with America’s willingness to confront Iran.

Possibly as a result of the Israeli stance, they have also begun to talk about “Bushehr for Yitzhar,” meaning U.S. willingness to pressure Iran about its nuclear reactor near the city of Bushehr depends on having Israel dismantle the Jewish settlement of Yizhar on the West Bank.

Residents of Yitzhar were not pleased by the American demand.

“I am more than merely suspicious that it was Israelis who put together that rhyme, maybe Israelis who work with Obama,” said Yigal Amitai, a resident of Yitzhar. “After all, it isn’t Yitzhar that bothers the Arabs, but the very Israeli presence anywhere to the west of the Jordan River. I haven’t got any expectations of the Americans, but I do expect that Mr. Netanyahu make it clear that those ideas are completely out of the question.”

Eli Eitan, an American citizen who moved to Yitzhar from New York 11 years ago,

also expressed his disgust with the Obama administration’s demands.

“As an American citizen I’m offended by that statement. How can one draw a comparison between a country whose entire substance is terrorism, and me, who only wants to settle in my homeland?” Mr. Eitan asked.

These U.S.-Israeli controversies also coincide with Obama Middle East envoy George Mitchell’s visit to Israel.

Mr. Mitchell met with Israeli Foreign Minister Avigdor Lieberman on Thursday, and reports indicate Mr. Lieberman reiterated Israeli demands for the Palestinians to disarm their terrorist organizations before negotiations can proceed.

At the same time, Palestinians received Mr. Mitchell’s visit by firing yet another salvo of rockets into Israeli territory. This marked the 187th rocket attack from Gaza since Israel declared a self-imposed cease-fire on January 18.

David Bedein can be reached at dbedein@israelbehindthenews.com

Egyptian security sources tell the Middle East Newsline that Hezbollah sleeper cells have been active in Egypt since the summer of 2005.

The Hezbollah network contained more than 100 people, located in Alexandria, Cairo and El Arish, among other Egyptian cities.

The network contained at least 25 Hezbollah operatives who are believed to have been sheltered by Bedouins in the central part of the Sinai Peninsula.

These sleeper cells worked with the Iranian Revolutionary Guard Corps to use Cairo as well as the Sinai Peninsula to transfer funds, weapons, instructions and recruits to Gaza.

“Iran and Iran’s followers want Egypt to become a maid of honor for the crowned Iranian queen when she enters the Middle East,” Egyptian Foreign Minister Ahmed Abu al-Gheit said.

Sami Shihab, a reputed Hezbollah sleeper cell chief who was captured this month, has provided the details of the Hezbollah network in Egypt.

Mr. Shihab, a Lebanese national whose real name is Mustafa Mohammed Yusef Mansour, was said to have told Egyptian interrogators that Hezbollah had prepared a series of attacks on Israeli and other foreign targets in the Sinai.

“Elements of the cell monitored tourist sites in [Sinai’s] Taba, Sharm el-Sheikh, Dahab and Nueiba to conduct operations against Israeli tourists and visitors,” Mr. Shihab was quoted as having told interrogators. “They monitored Israeli ships moving through the Suez Canal.”

A Hezbollah commander, Mohammed Qublan, was assigned the mission to establish a network in Egypt in 2005. They said Mr. Qublan visited Cairo and transferred funds to Egyptian and Palestinian recruits.

The Hezbollah network in Egypt was used to facilitate the flow of fighters, weapons and ammunition from Africa into the Gaza Strip.

The network intensified activity in February 2008 in the wake of the assassination of Hezbollah operational chief Imad Mughniyeh, a killing attributed to Israel. In all, the sources said, Hezbollah planned at least three attacks on Israeli targets.

“The [Hezbollah] supreme leadership ordered Hezbollah not to stage operations in Egypt, rather within Israel,” Mr. Shihab was quoted as saying. “The operations have been already approved.”

At first, Mr. Shihab said, Hezbollah planned to attack Israeli interests in Egypt. He said Hezbollah sent operatives on forged passports to collect intelligence on a range of Israeli targets.

Another Hezbollah operative, Nasser Abu Umra, was said to have confessed to acquiring and concealing explosive suicide belts. Mr. Abu Umra was also said to have purchased a house in the divided city of Rafah to store weapons.

“This serious case, which affects the national security of Egypt and its national sovereignty, calls for zero tolerance and the protection of the state within a legal framework,” Egyptian Parliamentary Affairs Minister Mufid Shehab told parliament on Tuesday.

Bedouin smugglers have been clashing with Egyptian security forces throughout eastern Sinai. On Monday, an Egyptian border guard was shot and killed along the Israeli frontier. At the same time, another shootout was reported between Egyptian forces and Bedouins in central Sinai.

So far, Egypt has charged 49 alleged Hezbollah operatives. Egyptian Attorney General Abdul Meguid Mahmoud said the agents included those from Egypt, Lebanon, the Palestinian Authority and Sudan.

The Hezbollah network network was alleged to have already assembled suicide explosive belts, planned to purchase a boat and bring weapons from Somalia, Sudan and Yemen to Egypt.

“They were observing and locating the tourists groups who repeatedly come to south Sinai resorts and residences paving the way to target them in hostile activities,” Mr. Shehab said.

David Bedein can be reached at dbedein@israelbehindthenews.com

Israel and the United States plan to hold a major ballistic missile defense exercise later this year called Juniper Cobra. The maneuver will jointly test three different American and Israeli missile defense systems.

Israeli defense officials said Monday the exercise is necessary to create a joint missile defense infrastructure in the event of a conflict with Iran akin to what existed in 1991, when American Patriot batteries shot down inbound Iraqi Scuds.

The Israel Air Force’s Air Defense Division, the U.S. Missile Defense Agency and the U.S. Military’s European Command (EUCOM) have held the Juniper Cobra exercise for the past five years. The upcoming exercise is planned to be the most complex and extensive yet.

The exercise will include the newly developed Arrow 2 ballistic missile defense system as well as America’s THAAD (Terminal High Altitude Area Defense) and ship-based Aegis Ballistic Missile Defense System.

U.S. Missile Defense Agency director Lt. Gen. Patrick J. O’Reilly mentioned these plans during testimony that he provided to the U.S. House Appropriations Committee’s Subcommittee on Defense two weeks ago.

“The Juniper Cobra exercise between EUCOM and the IDF will be the fifth and most complex exercise yet designed,” Lt. Gen. O’Reilly told the subcommittee.

Last week, the Israeli Air Force held its 17th test of its Arrow 2 interceptor, shooting down a missile mimicking an Iranian Shihab ballistic missile.

In his extensive testimony, Lt. Gen. O’Reilly also revealed that in February the Israel’s David’s Sling missile defense system underwent a successful “booster fly-out” test. The exercise involved the successful launching of the jointly designed missile system, which is intended to intercept medium-range missiles at ranges of between 43 and 155 miles.

Amid mounting fears that the funding for the Arrow will be cut, Israel Defense Minister Ehud Barak plans today to meet with U.S. Rep. Nita Lowey, D-N.Y., who serves as the chair of the Foreign Operations Appropriations Subcommittee, responsible for approving the funding for the continued development of the Arrow 3.

Ms. Lowey has arrived in Israel as part of a congressional delegation.

Israel is hoping to secure $150 million from the U.S. government to continue development of the system by Israel Aerospace Industries and Boeing.

David Bedein can be reached at dbedein@israelbehindthenews.com

Turkey has widened its investigation of an attempted military coup against the government of Prime Minister Recep Erdogan.

The nation witnessed prior coups in 1960, 1971 and 1980.

Middle East Newsline says, so far, about 150 people, many of them military officers, have been prosecuted on charges of participating in the alleged coup.

Critics of Mr. Erdogan have countered the investigation was meant to neutralize the secular opposition.

“The judicial bodies are authorized to deal with those who commit crimes,” Deputy Prime Minister Hayati Yazici said.

On Monday, Turkish police arrested the dean of a leading university in connection with the so-called Ergenekon group. In all, 18 people were arrested, including two former university deans.

“Turkey is on the right track,” Mr. Yazici said.

The Turkish General Staff has expressed concern over the arrests. So far, the military has not directly intervened in the investigation.

The Turkish government is also targeting the head of a Turkish secular group, the Ataturk Thought Association, with branches throughout the country and organizer of anti-government demonstrations in 2007. The home of Ataturk Thought Association chairman Mustafa Yurtkuran has been searched as part of the more than year-long investigation.

“This is an operation against the intellectuals of this country,” Kemal Kilicdaroglu, an opposition leader in parliament, said.

Turkey plays a key strategic role as a member of NATO and is a neighbor of Iran.

David Bedein can be reached at dbedein@israelbehindthenews.com

The Saudi government’s official state news agency, the Saudi Press Agency, has reported the Saudi Cabinet issued a strong directive Monday calling for “swift action” to be taken to establish an “independent vibrant Palestinian state.”

The Saudi Cabinet summed up statements made by Minister of Culture and Information, Abdul-Aziz Khoja, calling on the United States to “put pressure on Israel” to implement a March 2002 Saudi initiative. The measure would require Israel to expel Jews from East Jerusalem and other areas captured by Israel during the 1967 Six-Day War to make room for an independent Palestinian state.

The 2002 initiative also called for Israel to recognize a December 1949 U.N. resolution that calls for Palestinian Arab refugees and their descendants to return to Arab villages abandoned during Israel’s 1948 War of Independence.

Saudi Arabia has remained in an active state of war with Israel since 1948 and is the only Arab nation state contiguous to Israel that has never signed a peace agreement or even an armistice deal with Israel. The Arab League declared war to decimate the nascent Jewish state in 1948. That state of war still exists, and Saudi Arabia exercises a leadership role within the Arab League.

Since 1948, Egypt and Jordan have signed peace treaties with Israel, and Syria and Lebanon have signed armistice accords with Israel.

In the context of its war with Israel, Saudi Arabia continues to provide funding for Damascus-based Palestinian terrorist organizations that rejected the peace process with Israel.

David Bedein can be reached at dbedein@israelbehindthenews.com

Iran has approved plans to bolster its navy by building a new destroyer and diesel-electric submarines. The Islamic state says the destroyer would be the largest built by a Middle Eastern nation.

It currently operates three Russian-built diesel-electric submarines and a small assortment of aging British and American destroyers and frigates. Additionally, the Iranian navy has numerous smaller patrol craft that it uses in the Persian Gulf.

“The Iranian nation will see that we will manufacture the largest destroyer and the most advanced submarines in the region,” Iranian Deputy Chief of Staff Maj. Gen. Ataollah Salehi told the Iranian-government controlled Fars News Agency.

Iran says these new warships will allow it to project its naval power far away from home in places such as in the Mediterranean Sea off the Israeli and Egyptian coasts.

“The Islamic Republic of Iran Navy will regularly patrol oceans and will be dispatched to far distances,” Maj. Gen. Salehi said last Friday.

David Bedein can be reached at dbedein@israelbehindthenews.com

Israeli Prime Minister Benjamin Netanyahu has held preparatory discussions with Defense Minister Ehud Barak and Foreign Minister Avigdor Lieberman in advance of U.S. Special Envoy George Mitchell’s visit to the Middle East tomorrow.

The three senior Israeli officials were joined Monday by senior security officials, including the prime minister’s top security adviser, Uzi Arad, and the head of the Israeli Defense Ministry’s Diplomatic Security Bureau, Amos Gilad.

Mr. Mitchell’s visit occurs three weeks prior to Mr. Netanyahu’s scheduled first visit with President Barack Obama in Washington, D.C.

According to Kenneth Timmerman, a Washington, D.C.-based researcher who met with officials closer to the prime minister, Mr. Netanyahu plans to focus his talks with the new administration on stopping Iran’s nuclear capability.

David Bedein can be reached at dbedein@israelbehindthenews.com

According to the Middle East Newsline, Israeli military sources say Hamas has converted fishing boats into unmanned attack vessels to challenge Israel’s naval blockade of the Gaza Strip.

Hamas, in cooperation with such militias as Islamic Jihad and the Popular Resistance Committees, have fitted the boats with explosives as well as remote-control devices.

“First, Hamas tried to use remote-controlled rafts or rowboats,” an Israeli military source said. “When that didn’t work, they moved to larger vessels.”

The report follows an attempted Monday attack against an Israeli patrol vessel off Gaza.

The sources said the boat, which contained hundreds of pounds of explosives, was directed by remote control to head from the Gaza Strip toward Israel.

An Israel Navy patrol boat followed the Palestinian vessel for about an hour, the sources said.

There were no Israeli injuries or damage reported in Monday’s attack.

The assembly of the unmanned explosive boat appeared to be part of Hamas plans to attack an Israeli coastal facility, such as the Israeli beaches located two miles north of Gaza.

This marked the first Palestinian vessel bombing off the Gaza coast since 2003. In 2002, four Israeli commandos were injured when a Palestinian boat blew up near an Israel Navy patrol craft.

As a result, the Israel Navy has intensified patrols along the Gaza coast and has been firing on suspicious fishing boats.

Israeli Army Chief of Staff Lt. Gen. Gabi Ashkenazi said the unmanned explosive boat marked a new Hamas tactic in the wake of Israel’s incursion into Gaza.

“I think that Hamas has been intimidated, and it is not by chance that there is no direct firing,” Lt. Gen. Ashkenazi said. “We know that hostile terror activities or terror attacks along the security fence – by sea or through the Sinai – are still taking place, and therefore we examine and adjust our arrangements constantly.”

David Bedein can be reached at dbedein@israelbehindthenews.com

Thirty Israeli-Americans have filed an unprecedented lawsuit in an American court charging the North Korean government with providing material support to Hezbollah during the 2006 war in Lebanon.

The suit seeks more than $100 million in damages.

The plaintiffs – seven of whom were from Safed, a town in northern Israel that came under Hezbollah rocket attacks during the war – claim they were injured by the rockets or sustained property damage. They say North Korea helped Hezbollah by training its agents and built a network of bunkers that were used to store the rockets used in the attacks from southern Lebanon.

This is the first time that victims of Hezbollah have filed suit against the government of North Korea for providing material support to a terror organization.

The suit quotes a May 2008 congressional memo that described one of the buildings that North Korea built as a 15-mile long tunnel Hezbollah used to mobilize its troops.

The memo noted that these underground buildings significantly improved Hezbollah’s ability to fight against Israel in the course of the war.

David Bedein can be reached at dbedein@israelbehindthenews.com