Foreign Minister Tzipi Livni on Thursday called for a unity coalition to pursue the creation of Palestinian state living peacefully alongside Israel, saying "time is against the moderates" looking to reach a peace agreement.

Livni, a front-runner to replace Prime Minister Ehud Olmert, said she would try to form such a government if she wins next month's primary election of the ruling Kadima Party, as polls indicate she is likely to do.

"I believe that what we called in the past left and right is something that belongs to the past," she told foreign reporters in Jerusalem. "Now most Israelis understand that having two states in the lands comprising historic Palestine is an Israeli interest." Livni pointed to opinion polls that show her party winning a general election if she becomes Kadima head.

However, she said she would prefer to keep the existing coalition, and even bring in new partners to strengthen it, rather than go to new elections.

On Thursday she sent mixed signals on whether it would be possible anytime soon to sign and implement a peace accord that would
presumably enable Israel to remain both Jewish and democratic by allowing it to shed responsibility for millions of Palestinians.

"We decided that time is against us, that time is against the moderates and that stagnation is not an option for the Israeli government," she said in explaining the government's decision to hold peace talks with the moderate Palestinian leadership based in the West Bank.

At the same time, however, she implied that no agreement could actually be implemented until moderate Palestinians established full control of their own territory and regained control of the Gaza Strip, which the militant Hamas group violently took over last year.

"Nobody, nobody can afford in the region a terror state, a failed state or an extreme Islamic state between the Jordan river and the Mediterranean sea," she said.

Israeli and Palestinian leaders vowed at a U.S.-hosted Mideast peace
conference last November that they would strive to have an agreement signed by the end of this year. Officials have been backing away from that timetable in recent weeks.

Livni also said Thursday that it would be dangerous to rush into an agreement without hashing out key details.

"This can lead to clashes. This can lead to misunderstandings. This can lead to violence," she said.

"It's not my choice. It's theirs," she said of Knesset members who will have to decide whether to join up with her if she becomes head of Kadima.

Olmert has promised to step down after next month's primary, amid the series of highly damaging corruption probes that have made his continued stay in office untenable.

The 50-year-old Livni spent much of her career as a member of the hawkish
Likud Party, and she is the daughter of a famous fighter of the early militant Zionist group Irgun.

However, she has carved a niche for herself as a leading moderate since
leaving Likud and joining the government of former Prime Minister Ariel
Sharon, who formed Kadima in 2005 as a way of pushing through his plan to
withdraw Israeli troops and settlers from the Gaza Strip.

In the coming months, Livni will face stiff political competition both inside and outside her party, especially from hardliners such as former Prime Minister Benjamin Netanyahu. Success, however, would make her Israel's first female prime minister since Golda Meir.

Livni is currently Israel's lead negotiator in peace talks with the
Palestinians.

On other issues, Livni expressed concern about a visit to Russia this week by Syrian President Bashar Assad, who is reportedly seeking to purchase long-range anti-aircraft missiles from Moscow.

"It is of mutual interest of Israel of Russia, of the pragmatic leaders in the region, not to send these kinds of long range missiles to Syria," which she said was working to destabilize Lebanon, strengthen ties with Iran and prop up extremist groups such as Hezbollah and Hamas.

Livni expressed concern that Israel's negotiations with Syria granted the Arab state legitimacy, despite its continued support of terror groups.

She also called for tougher sanctions against Iran, which she said is moving rapidly to enrich enough uranium to build an atomic weapon.

Meanwhile, Russian President Dmitry Medvedev and Olmert spoke on the phone Wednesday evening, and discussed the situation in the Middle East and the Caucasus.

Olmert gave Medvedev an overview of Israel's current diplomatic position with the Palestinians and Syria, and the two also discussed the crisis between Russia and Georgia.

The discussion came one day before Assad is scheduled to arrive in Moscow for a two-day visit, which has been described by analysts as important at a time when Moscow may be considering closer ties with the Arab world.

Assad told Russia's Kommersant newspaper on Wednesday that he would use his visit to expand military ties with Moscow, whose arms sales to the Middle Eastern state have angered Israel and the United States.

He said that Russia's conflict with Georgia, in which Moscow says Georgia used Israeli-supplied equipment, underlined the need for Russia and Syria to tighten their defense cooperation.

Assad is expected to have talks with Medvedev during his visit this week.