JERUSALEM, March 29 (Reuters) - Israel said on Thursday it was interested in holding talks with moderate Arab states but stopped short of welcoming a 5-year-old peace initiative endorsed by Arab leaders. Here is a full statement issued by Israel's foreign ministry on Thursday following the end of an Arab summit in Riyadh: Israel believes in peace, and seeks to establish peaceful and neighbourly relations both with the Palestinian people and with all the states of the region. Israel is sincerely interested in pursuing a dialogue with those Arab states that desire peace with Israel, this in order to promote a process of normalisation and cooperation. Israel hopes that the Riyadh summit will contribute to this effort. Israel's position with regard to the peace process with the Palestinians is founded upon fundamental principles, the most central of which is the existence of two nation-states, with each state addressing the national aspirations of its own people -- Israel for the Jewish people and Palestine for the Palestinian people -- and with both states coexisting in peace, free of the threat of terrorism and violence. For this purpose, a direct dialogue between Israel and the Palestinians is necessary. Israel also believes that moderate Arab states can fill a positive role by encouraging regional cooperation, and supporting the Israel-Palestinian track. A dialogue between these states and Israel can contribute to this end.
