BRITAIN and Israel attempted to overcome their strained relations yesterday, but differences persisted over peace efforts in the Middle East and Britons linked to terrorist groups.

Silvan Shalom, the Israeli Foreign Minister, said during a visit to London that Israel regarded Britain as a “close friend” and wanted to restore the “warm relations” that had existed until a series of diplomatic rows over the past five months.

Late last year, Benjamin Netanyahu, then Israeli Foreign Minister, was incensed when he was barred from meeting Tony Blair during a visit to London, just after President Assad of Syria was welcomed to Downing Street and Buckingham Palace.

Then Ariel Sharon, the Israeli Prime Minister, was enraged when Israel’s opposition leader was greeted in Downing Street only days before his defeat in the general election. Israel retaliated by preventing Palestinians from attending a peace conference in London hosted by the Foreign Office.

The Government went out of its way to restore good relations yesterday. Mr Shalom was greeted at Downing Street for talks with Mr Blair and Lord Levy, his personal envoy to the Middle East. Later he saw Jack Straw, the Foreign Secretary.

“I think it is very important that we will have now warm relations like we had in the near past,” Mr Shalom said. “Among friends, we can have difficulties, but we are working on it in order to overcome those difficulties.”

In another move that could ease tensions, Sherard Cowper-Coles, the controversial British Ambassador to Tel Aviv, who has been embroiled in a series of public spats with the authorities, is being transferred to Saudi Arabia as ambassador, after less than two years in the job. He will be replaced by Simon MacDonald, currently Mr Straw’s private secretary.

In spite of the attempts to smooth relations, Mr Shalom said that the British Government could do more to combat anti-Israeli incitement, which he blamed for recent suicide bomb attacks in Israel by British citizens.

“I have heard from my colleague (Jack Straw) how when he was the Minister of the Interior, he was working to prevent these organisations from incitement against the Jewish community and Israel,” Mr Shalom said. “I am sure that always more can be done and I hope that this attack ... was the first and the last that will come from Britain.”

Mr Straw raised the issue of three British nationals killed by Israeli forces in the occupied territories in the past year and was told that official investigations were underway.

The biggest potential for disagreement, however, remains the Middle East peace process.Mr Blair has strongly promoted the current “road map”, which envisages the creation of a Palestinian state by 2005.

Israel insists that the plan needs to be amended and yesterday Mr Shalom deliberately did not endorse it.

Mr Sharon said that Israel resented Britain’s continued intervention on the matter. “In my younger days, I always saw Tony Blair as a friend of Israel and he may be a friend of Israel today, but those comparisons, the demands on Israel, appeared to me as unnecessary intervention,” he told the Jerusalem Post.

The fate of the latest peace initiative is likely to be decided next week when Mr Sharon travels to Washington to see President Bush, who has greatest influence in the region.

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