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It was learned that the talks have been conducted by Israeli Ambassador Asher Ben Natan and Ambassador Herve Alphand, secretary general of the French Foreign Ministry. Haim Zadok, chairman of the Knesset Foreign Affairs and Security Committee, explained in a broadcast interview tonight the reasons why Israel has apparently reversed its position and is now willing to discuss compensation for the aircraft.

He said Israel was convinced that DeGaulle’s embargo policy is now an integral part of French foreign policy accepted by his successors and that both France and Israel want to remove the issue that has beclouded relations between the two countries. Zadok said, furthermore, that Israel was satisfied that the planes would not fall into the hands of a third power that might use them against Israel. Finally, the Mirages which were regarded as the world’s finest fighter plane four years ago, are becoming obsolete and Israel prefers the money which it badly needs, Zadok said.

ISSUES TO BE SETTLED PENDING

One of the issues that have to be settled is Israel’s demand for interest on the capital it has tied up in the planes which have been grounded for four years and France’s counter-demand for payment for storage and maintenance of the aircraft. Israel reportedly paid $1 million for each of the 50 jets and another $600-$900,000 per plane for special equipment.

The French newspaper Le Monde stated yesterday that the initial cost of the aircraft was $90 million and that according to French aviation circles the government envisioned paying Israel $130-$140 million. The Mirages are stored in a heavily guarded French Air Force hangar at Chateau D’Un and are kept in operative condition by technicians of the Dassault firm which manufactured them.

A major stumbling block to a settlement was removed when France announced that its Air Force would absorb the planes, precluding their resale to a power that might be hostile to Israel. The French Air Force reportedly needs the Mirages due to the bankruptcy of the Rolls Royce firm which has delayed production of the Jaguar, a jet being built jointly by France and Britain.

Israel reportedly decided to accept payment because of its serious balance of payments deficit and current financial pinch that may result in cutting next year’s defense budget. Israel also wants assurances that Mirage spare parts will continue to flow to Israel for the Mirages presently in the Israel Air Force. Informed sources here dismissed as imaginary a report by Le Monde that Israel was building its own version of the Mirage known as the Barak for which it needed the spare parts.

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