JERUSALEM, Sept. 4 (JTA) – Word that a country will establish diplomatic relations with Israel is generally welcomed as a sign of decreased isolation for the Jewish state. But in the case of the former Yugoslav republic of Croatia, the applause is far from unanimous – and much of the criticism focuses on the country’s leader, President Franjo Tudjman. During a formal ceremony Thursday in New York that capped an agreement reached late last month, the two countries officially forged diplomatic ties. The move came after Tudjman said he plans to visit Israel and apologize for his nation’s persecution of Jews during World War II. Tudjman’s nationalist policies are viewed by many as an attempt to rehabilitate the fascist Ustashe regime that ruled Croatia as a Nazi puppet state during World War II. He drew particular fire in 1996 by declaring that he wanted to rebury the bones of Croatian fascists at a Yugoslav-built memorial to the thousands of Jews and Serbs slaughtered at the Ustashe’s Jasenovac concentration camp. Croatia had 25,000 Jews before World War II, most of them prosperous and largely assimilated. Some 20,000 were killed by the Nazis or the Ustashe regime. Croatia this week decided to cede to Holocaust survivors its share of gold held by the Tripartite Commission, which is charged with returning Nazi-seized gold to European central banks. Britain, France and the United States agreed to freeze the gold while they review evidence that some of it was stripped by the Nazis from concentration camp victims. The Israeli government’s decision to establish ties with Croatia came under sharp criticism last week from Labor Knesset member Yossi Beilin, who said Tudjman had yet to fully repudiate writings which cast doubt on the number of people killed during the Holocaust. Beilin said that when he was deputy foreign minister in 1995, he turned down a request by Croatia to establish ties, saying Israel would only do so if Tudjman removed anti-Semitic sections from his 1989 book, “Wastelands of History.” Israeli officials viewed the book as anti-Semitic, and Tudjman subsequently issued a revised English version under a new title, “Horrors of War,” from which the most controversial parts were dropped. The director-general of the Foreign Ministry, Eitan Ben Tsur, last week defended the decision to forge ties with Croatia, saying that Tudjman had removed the anti-Semitic sections from his book. Ben Tsur added that Tudjman had offered to visit Israel and place a wreath at the Yad Vashem Holocaust memorial. Beilin charged last week that the changes were made only in the English-language version of the book and that Tudjman has never publicly apologized for the remarks which still appear in the Croatian-language edition. “He is simply a classic anti-Semite, and the statements in the book are scary. When such a person is president of a state, we have a problem,” Beilin said. He added that in his view, the only reasons Israel had agreed to establish ties with Croatia was because “all of a sudden we’ve returned to a state of international isolation, so we welcome anyone.” Another motivation was suggested last week by the Israeli daily Ha’aretz, which reported that the forging of ties will clear the way for Israel to sell Croatia more than $100 million in unspecified “non- lethal” weapons. The paper quoted a senior political official as saying that negotiations between Croatia and Israeli defense industry officials began in 1992 after Israel joined the countries recognizing Croatia as a U.N. member- state. At that time, the Prime Minister’s Office and the Defense Ministry began pressuring the Foreign Ministry to establish diplomatic relations with Croatia, Ha’aretz reported. Defense Ministry officials would not provide any information about what the military sale to Croatia would include, but military experts said it could cover a wide range of items such as tear gas, radar and electronic sensors. The Simon Wiesenthal Center last week joined the chorus of critics urging Israel to reconsider forging ties with Croatia. “I am afraid that interest groups which stand to gain from this decision are pressuring the government to establish relations, a step which we are likely to regret in the future,” the center’s Israel director, Efraim Zuroff, said in a statement.