WASHINGTON, Feb. 26 (JTA) — Both Israel and the United States are giving a cautious welcome to an initiative for Arab-Israeli peace from Saudi Crown Prince Abdullah. Essentially an extension of the land-for-peace principle that has guided Arab-Israeli peacemaking for years, the plan calls for the Arab world to recognize Israel and offer diplomatic relations, economic ties and security guarantees in exchange for a complete Israeli withdrawal from all territories won in the 1967 Six-Day War. The ideas are similar to those voiced in recent months by Jordan´s king, Abdullah II. The Saudi plan was contained in a speech Crown Prince Abdullah told New York Times columnist Thomas Friedman he had considered delivering but then decided not to, allegedly because of Israeli actions toward the Palestinians. Still, the Saudis authorized Friedman to print the interview with the crown prince, and then circulated the accounts in the Saudi media. As such, the "nonproposal" has taken on a life of its own, and officials at the U.S. State Department say they consider it Saudi policy. "I think it´s an important step that we have welcomed," Secretary of State Colin Powell said Monday, adding that he hoped "that in the weeks ahead, it´ll be flushed out in greater detail." Israeli officials — particularly Foreign Minister Shimon Peres — reacted with interest to the Saudi plan. President Moshe Katsav said he was prepared to go to Saudi Arabia to discuss the plan, but the Saudis immediately rejected the idea. Prime Minister Ariel Sharon confirmed that he had taken "several steps" to learn more about the initiative, but did not elaborate. Israel Radio reported that Sharon was making inquiries through several channels, including the United States. The report said he was interested in learning the details through either open or secret contacts with the crown prince or a trustworthy representative. European Union foreign policy chief Javier Solana was to hold talks Wednesday with Abdullah after the Palestinians and some Israeli officials responded positively to the Saudi initiative, an E.U. official said Tuesday. After Friedman´s column appeared, another New York Times piece by Henry Siegman, a senior fellow at the Council on Foreign Relations, fleshed out the plan, noting that it would not preclude Israeli sovereignty over some neighborhoods in eastern Jerusalem and land transfers that would bring some West Bank settlement areas under Israeli sovereignty. Analysts say that a commitment from Arab countries to normalize relations with Israel if an Israeli- Palestinian deal is signed can help the parties focus on the big picture. "Coming from Saudi Arabia, which has a distinct leadership position in the Arab world, it raises the profile of the concepts contained within the plan and perhaps creates a new opportunity for the United States to get behind a viable peace plan," said Lewis Roth, assistant executive director of Americans for Peace Now. It remains unclear whether the intiative ever will be formally drafted or proposed. As long as they don´t formally issue the plan, the Saudis can reap a diplomatic windfall for their allegedly positive attitude to Arab-Israeli peace, while pointing out to the Arab world that they never really proposed anything. Israel, therefore, hopes the Saudis will present the plan at a late March meeting of the Arab League, which would give the plan more credibility in Israeli eyes. Egypt, Jordan and Lebanon reportedly have responded positively to the initiative. A Saudi newspaper reported that Syria was not opposed to it. Palestinian Authority President Yasser Arafat also endorsed the plan, said Siegman, who met with Arafat on Monday. Arafat´s endorsement included a call to allow Israel to retain sovereignty over the Western Wall and the Jewish Quarter of Jerusalem´s Old City, Siegman said, adding that it was the first time Arafat had conceded sovereignty over a part of eastern Jerusalem. According to the Jerusalem Post, Arafat told Siegman that the Saudis are unlikely to present the initiative at the Arab League summit in Beirut if Arafat is not allowed to attend. Sharon´s government has prevented Arafat from leaving the West Bank city of Ramallah since December, demanding that he first makes more effort to rein in Palestinian terrorists. Missing from the plan is any mention of how Jerusalem would be controlled, or the "right of return" that Palestinians claim for millions of refugees and their descendants to homes they left during Israel´s 1948 War of Independence. Israeli officials are taking the omissions as a sign that the Saudis are open to Arab concessions on those issues. However, a senior aide to Sharon said Monday that Israel could not agree to the plan´s key provision — a return to the pre-1967 borders, under which Jerusalem was divided. It was not clear whether the Saudis are open to any negotiation over the plan. Bush administration officials are seeking more details about the initiative. Nevertheless, they are intrigued by the idea, saying Arab support is an important "piece of the puzzle" toward a Israeli-Palestinian peace, and encouraging the Saudi prince to flesh out his proposed statement. The plan is expected to be a topic of discussion when Vice President Dick Cheney visits the region next month. But they note that their immediate goal is a cease-fire, and that the pressure is still on Arafat to control violence. "It may be unclear how this can lead to an end to violence, but I think if we ever get back to a political discussion on final-status issues, this will be a very useful tool," a State Department official said. Administration officials note that the failure of Egypt and Saudi Arabia, considered the two most important Arab regimes, to give Arafat a diplomatic "umbrella" at Camp David may have contributed to his unwillingness to finalize a deal. While some parties have resisted discussing the parameters of a final agreement while violence continues, many believe there needs to be some idea of a diplomatic solution to give the sides a reason to stop fighting. But many are wary of the Saudi plan, seeing it as only a small ray of hope that the United States is grasping because of a dearth of alternatives. "There is a huge difference between an actual plan and an off-the-record discussion," said an official with an American Jewish organization. "It will be interesting to see whether or not the Saudis decide to actually present the speech, as he planned, and galvanize other Arab countries to support the initiative." Speculation is rife about the Saudis´ motives in presenting the initiative. One possibility is that Saudi officials want to improve their image in Washington after the Sept. 11 terror attacks. Fifteen of the 19 terrorists were Saudis. According to the Israeli daily Ha´aretz, Israel´s Foreign Ministry has come up with several possible motives for the Saudi initiative — including the possibility that it was aimed at forging a unified Arab front on the diplomatic process, while casting Israel in the role of obstructor to the peace process. Some suggested Abdullah floated the initiative as a trial balloon to test Arab and international reaction before the Arab League meeting. Others suggested that the Saudis are concerned that the ongoing Israeli-Palestinian conflict could destabilize the entire region. Some left-wing Israeli commentators speculated that the proposal was aimed at motivating the Israeli opposition into believing that there is an Arab partner for peace, if only the Sharon government could be overthrown. Whatever Abdullah´s thinking, State Department officials say the plan has changed the playing field for a final Middle East peace plan. "We´re taking it as a statement of Saudi policy and we are holding them to it," the State Department official said. "I don´t think there is a way to put this back in the bottle."