Washington: Refusing to decrease the border conflict with Palestinians, Israeli Prime Minister Benjamin Netanyahu told the US Congress that his country was willing to make painful compromises and would be generous with the size of a future Palestinian state.

'Israel will be generous on the size of the Palestinian state, but will be very firm on where we put the border with it. This is an important principle,' Netanyahu told Congress.

A Palestinian official said the Israeli PM had added more obstacles to a deal.

Last Friday, Netanyahu had rejected US President Barack Obama's call for a peace deal with the Palestinians based on pre-1967 borders, plus land swaps.

In a landmark speech to the State Department last Thursday, Obama said the peace negotiations should result in 'a viable Palestine, and a secure Israel'.