Israel Reacts Calmly to Warning : Mideast: Jerusalem officials regret that ‘Iraqi intransigence’ is blocking a diplomatic solution.

JERUSALEM —  Israel officials reacted calmly but firmly Wednesday night to Iraqi Foreign Minister Tarik Aziz’s blunt warning in Geneva that Iraq would “absolutely” involve the Jewish state if war occurs in the Persian Gulf.

Avi Pazner, aide to Prime Minister Yitzhak Shamir, said that Israel would have preferred a “diplomatic solution” but that because of “Iraqi intransigence,” that might no longer be possible.

Defense Minister Moshe Arens declared that “everything depends on Saddam Hussein,” the Iraqi president.

And former Defense Minister Yitzhak Rabin warned that if attacked, “Israel is ready to respond strongly and destroy considerable targets in Iraq.”

Iraq’s Aziz appeared to go out of his way at his news conference in Geneva to single out Israel, and its continuing occupation of Palestinian Arab areas, as a key to any settlement that would involve an Iraqi withdrawal from Kuwait.

Aziz suggested that any discussion of an Iraqi pullout is linked to the end of the Israeli occupation of the West Bank and Gaza Strip.

But Israeli officials expressed satisfaction that Secretary of State James A. Baker III remained steadfast in rejecting any such linkage.

“Baker said at his news conference what he told us in private before the meeting,” said one senior official here.

And chief government spokesman Yossi Olmert said there were no real surprises in the statements by Baker and Aziz following their unproductive Geneva meeting.

“Iraqi threats against Israel are getting to be ritualistic now,” Olmert said. “We continue to warn that we will respond to any attack. And the Iraqis know this.

“The Geneva meeting really doesn’t change anything in Israel.”

Foreign Minister Aziz’s threat against Israel was contingent on an attack on Iraq by the U.S.-led forces in the Saudi desert.

Israel’s strategy has been to keep a low profile in the gulf conflict, leaving most of the anti-Iraqi military scenarios to the United States and its many coalition allies.

Nevertheless, the Israeli armed forces have been in an advanced state of readiness, short of mobilization, with cutting-edge units--such as the air force, antiaircraft batteries and the intelligence corps--on high alert to guard against any attack from Iraq.

Israeli officials rule out any preemptive attack against Iraq--unless, they say, it becomes apparent that Iraq is readying its missiles near the Iraqi-Jordanian border, which because of their nearness to Israel are seen here as a distinct threat.

Several top Israeli officials privately indicated that the grim and negative tone of the Geneva meeting did not necessarily preclude an eventual agreement by Hussein to withdraw.

“We’re not sure the Wednesday talks were the end of it,” said one official. “There’s still time for Saddam to change his mind.”

Israelis of all political factions worry that Hussein will indeed pull out of Kuwait at the last minute, thus evading war--but retaining his military might and nuclear potential intact.

In this scenario, the U.N. resolutions demanding an Iraqi pullout would be complied with, the American forces would go home, and Hussein could concentrate on building up a chemical, nuclear and missile armory to threaten Israel in a few years.

The chief hawkish note sounded Wednesday was by Foreign Minister David Levy, who said that Israel would respond to any attack by Iraq, even if that meant splitting the U.S.-led coalition, which has a number of Arab members.

He was responding to remarks attributed in a Cairo newspaper to Egyptian President Hosni Mubarak, who apparently threatened to pull out of the coalition if Israel fought against Iraq.

Mubarak reportedly told Al Akhbar on Tuesday, “We do not agree to any Israeli intervention under any circumstances.”

Several senior government officials have indicated that Israel would ponder the nature of any retaliation against Iraq in order not to embarrass the United States in its relations with its Arab allies.

But Levy, who does not always see eye to eye with Prime Minister Shamir, said Wednesday that “a responsible state cannot allow itself to be attacked without responding, just to preserve some coalition which is following the United States.”