Relations between Israel and Britain remained strained on Thursday over Downing Street's intention to label products manufactured in West Bank settlements, a week before the expected arrival of British Secretary of State for Foreign and Commonwealth Affairs, David Miliband, to the Middle East.

Miliband, who will visit Israel, the Palestinian Authority, Syria and Lebanon next week, is expected to talk to Israeli officials over the settlements in the West Bank and his country's proposed plan to label products manufactured in them. "This initiative is a serious and substantial problem in relations between the two countries, and is generating a sense of crisis," a senior diplomat in Jerusalem said.

Over the past few weeks Foreign Minister Tzipi Livni has spoken to Miliband and tried to persuade him to cancel the plan, by equating it to the initiative by U.K. academics to ban their Israeli counterparts. The British Secretary of State responded that the policy did not amount to an embargo on products made in the West Bank, but was merely an attempt to enforce previous trade agreements between the two countries.

British sources on Thursday added that Miliband plans to speak to Syrian President Bashar Assad in Damascus over his country's ties to Iran, and urge him to continue peace talks with Israel in return for improved relations with the U.S. and U.K.

Israeli diplomats, meanwhile, stressed that the only official mediators in talks with the Syrians are the U.S. and Turkey. Miliband has not been authorized to speak on Jerusalem's behalf, they added.

Foreign Ministry officials believe the British are interested in increasing their involvement in Middle East talks, out of the expectation that once U.S. president-elect Barack Obama is sworn into office they will be able to push forward a regional peace effort together with the White House.

Meanwhile, British ambassador Tom Phillips was summoned by the foreign ministry on Thursday to discuss fears by former Israel Defense Forces officers that they will be arrested in the U.K. and stand trial for war crimes. Israeli officials told Phillips that they were disappointed that the British government has not changed legislation that will prevent U.K. courts from trying Israeli officials. Former IDF generals including Minister of Transportation and former IDF Chief of Staff Shaul Mofaz have chosen not to travel to the U.K. out of fear they will be arrested by local authorities.

A few days ago Israeli ambassador to the U.S. Ron Prosor held a meeting with Miliband, during which the Israeli official rejected the Secretary of State's argument that the plan to label products made in West Bank settlements was simply part of the U.K.'s attempts to enforce trade agreements. Prosor told Miliband that its initiative to label the products was part of an attempt by Downing Street to influence Israeli policy toward the settlements, and that any other explanation was an excuse.