Israel has rejected two proposals from Qatar to restore diplomatic relations and let Israel reopen its office in the capital of Doha.

A senior source in Jerusalem said that in return for renewed diplomatic relations, the Qataris demanded that they be allowed to carry out a series of reconstruction projects in the Gaza Strip and to import the necessary construction materials. Prime Minister Benjamin Netanyahu and Foreign Minister Avigdor Lieberman were unwilling to agree to this, he said.

Qatar suspended its ties with Israel during Operation Cast Lead in Gaza in December 2008, during a summit it hosted with the participation of Iran and the leaders of Hamas and Islamic Jihad. In January 2009, Qatar asked the head of Israel's office in Doha, Ro'i Rozenblit, to leave the country.

Israel, for its part, was angered by Qatar's move closer to the radical axis headed by Iran.

Six months ago, however, the Qataris began relaying a series of messages to Israel - through covert channels, through the United States and France, and even in direct talks with Israeli diplomats. The messages included a proposal to resume diplomatic ties and reopen Israel's office in Doha.

In return, Qatar sought to assume responsibility for rebuilding Gaza. It also asked Israel to make a public statement expressing appreciation for the emirate's role and acknowledging its standing in the Middle East.

Deliberations were held at the Foreign Ministry and the Prime Minister's Office, and a fierce argument erupted between those who supported resuming ties, even at the cost of granting Qatar a role in Gaza, and those who argued that the Qataris had opted for an alliance with Iran and Hamas, so there was "no reason to give them gifts."

In the end, a senior Israeli official said, the issue was removed from the agenda due to American opposition.

However, the Qataris continued their covert contacts with Israel, and two months ago, they made another, similar offer. But Lieberman and Netanyahu decided to reject this offer as well.

A senior Israeli official familiar with the details of the discussions said that Netanyahu was actually initially inclined to accept the offer, as were both Lieberman and National Security Adviser Uzi Arad.

However, the official said, they ultimately rejected it, because the Qataris conditioned the resumption of diplomatic ties on an Israeli agreement to allow large quantities of cement and construction material into the Gaza Strip. The amount stipulated by Qatar was much greater than Israel was willing to approve, he said.

"Allowing such massive amounts of construction material into the Strip, of the sort that Hamas uses to build bunkers and reinforced positions for missile launches against Israel, runs counter to Israel's security interests," he explained.