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Israeli PM: Mideast Peace Deal Unlikely by 2012

Israeli Prime Minister Benjamin Netanyahu says he does not envision a negotiated Middle East peace settlement within the next two years, despite his Palestinian counterpart's intention to set up the institutions for a state by 2011.

Mr. Netanyahu told U.S. television's Fox News Sunday that a Palestinian state is possible, but that finalizing security arrangements and other issues will likely push the process beyond 2012.

Western-backed Palestinian Prime Minister Salam Fayyad, an American-educated economist, last year unveiled a government program to build the economic and legal infrastructure of a Palestinian state by 2011, regardless of progress in the stalled peace negotiations.

Mr. Netanyahu told his Cabinet Sunday that when he travels to Egypt for talks Tuesday, he plans to ask Egyptian President Hosni Mubarak to help promote direct peace negotiations with the Palestinians.

The two leaders last met in early May in Sharm el-Sheikh, Egypt, a few days before the start of the indirect peace talks - the first between Israel and the Palestinians in more than a year.

Mr. Netanyahu said last week after meeting with U.S. President Barack Obama in Washington that it is "high time" for direct talks between Israel and the Palestinians to begin.

However, Palestinian President Mahmoud Abbas says direct talks with Israel at present would be a waste of time. Mr. Abbas says direct talks cannot be resumed until there is progress in U.S.-brokered "proximity talks" on the issues of borders and security.

U.S. special envoy George Mitchell has been shuttling between the two sides in a series of indirect talks.

Israel's Haaretz newspaper reported Sunday that Ahmed Qurei, the former Palestinian prime minister and chief negotiator, said he saw no reason for the Palestinians and Israel to continue indirect negotiations after years of direct talks.

Speaking to Israeli opposition leader Tzipi Livni in Jerusalem, Qurei expressed bitterness that there has been little progress in resolving the conflict almost 17 years after Israel and the Palestinians signed the 1993 Oslo Accords.

Qurei also characterized rising tension with Israel over settlement building in the Jerusalem area as "a time bomb" that is eroding trust between the two sides.

Sunday's meeting was the first in nearly two years between Qurei and Livni, Israel's previous foreign minister. The two led their respective negotiating teams in reaching the Annapolis agreement in November 2007.

Some information for this report was provided by AP, AFP and Reuters.