Israeli government officials said yesterday that Egypt's peace proposal, while unacceptable in its present form, probably would not prevent Israel from participating in the forthcoming foreign ministers meeting in London.
The six-point peace plan by Egyptian President Anwar Sadat was delivered by U.S. Ambassador Samuel Lewis to Israeli Foreign Minister Moshe Dayan, and top Israeli government officials including Prime Minister Menachem Begin, immediately began studying and discussing it.
The Israeli Foreign Ministry said a formal decision on a whether to attend the London peace meetings will probably not be made until the Cabinet holds its regular Sunday meeting, but that the Egyptian proposal did not appear to contain any precondition that would prompt Israel to reject it summarily.
Last month, the Cabinet, acting on the basis of a Cairo radio report of a Sadat peace proposal, rejected the plan because negotiation on border security arrangements was conditional on Israeli withdrawal from territories it captured in the 1967 six-day war. -0334-ADD ONE ISRAEL-penny
Under the new plan, negotiations would take place among Egypt, Jordon, Israel and reprsentatives of Palestinian Arabs - with the participation of the United Nations - to agree on the timetable of withdrawal, details of transitional control and mutual security arrangements.
"The early indication is that there is no prior condition and Dayan will go to London. Neither in the peace plan itself nor attached to it is a requirement that Israel should agree to anything in advance," a Foreign Ministry spokesman said.
While the government is not expected to comment officially until the Sunday Cabinet meeting. Foreign Ministry officials noted that there still is an enormous gap between Sadat's peace plan and a 26-point plan put forward last December by Begin that would give limited self-rule to the Palestinians on domestic matters but would continue Israeli military occupation of the territories.
"The gap is very, very wide," said a Foreign Ministry official. "I don't see much here, in that the gap is so wide. It may come closer by inches, but I don't see how it can come together."
But Israeli officials observed that since Begin repeatedly pledged to negotiate any proposal not containing preconditions, Israel has to go to London to discuss the Sadat plan or risk condemnation of wlrld opinion.
Moreover, they observed that Cairo has not precluded compromise, and the United States is expected to play an axtive role not only in mediating the London but offering compromises. The meeting expected to begin the week of July 17, will also include Egyptian Foregin Minister Mohammed Ibrahim Kamel and Secretary of State Cyrus Vance.
A Foreign Ministry official said that Begin, in pledging to discuss everything put forward by Sadat, said that "everything" would include any proposal that is relevant in the context of U.N. Security Council Resolution 242, which calls for Israeli withdrawal from the occupied territories.
One feature that Israeli officials have already found to be the most objectionable by Sadat that Israeli withdraw from it of the West Bank, including East Jerusalem - an unlikely prospect given Israel's right to the West Bank is "eternal," and the vision of handing over to Jordan the sacred Wailing Wall is incomprehensible to most Israelis.
Another stumbling block is likely to be the provision that the withdrawal include the Jewish settlements that have been built on the West Bank since 1967. Israel has invested more that $1 billion placing 5,000 Jewish settlers in 51 outposts along the West Bank, and the Begin government has been committed to establishing more, not less settlements.
Gush Emunim, the religious ultra-nationalist movement, presented to Cabinet members yesterday a settlement plan that envisions a Jewish majority on the West Bank by the end of this century. Currently, the West Bank has 692,000 Arab inhabitants and the 5,000 Jewish settlers.
Also, Agricultural Minister Ariel Sharon has advanced a plan for settler 2 million Jews in the West Bank Defense Minister Ezer Weizman has urged the construction of six large urban centers there.
It is such broad differences that Vance and other U.S. representatives to London will have to overcome, but Israeli officials noted that the United States already appeared to have persuaded Egypt to make two significant changes frim the previous Sadat suggestion: the elimination of a precondition and the involvement of the United Nations in the negotiations with Egypt, Jordan and the Palestinians, and in the withdrawal phase.
Government sources also worried privately over the clause calling for talks about implementing "relevant U.N. resolutions on Palestinian refugees," a catch phrase that Israel is interpreting as an eventual - a Palestinian state controlled by the Palestine Liberation Organization.
The PLO is not mentioned in the Plan by name, however.
"We can talk all you want about that, but there isn't going to be any PLO state on the West Bank," said an official.