Conservative Party leader David Cameron has confirmed his commitment to Israel and its right to exist and defend itself, stating that he would never turn his back on Israel. Speaking to more than 400 Conservative MPs, lords, parliamentary candidates and business leaders at the Conservative Friends of Israel annual fundraiser at the Dorchester Hotel in central London on Thursday, the party leader said he felt an affinity towards Israel. "First, I passionately believe in the right of Israel to exist, to defend itself and to live in peace and security. Not just because of the tragedies of history. Not only because of the realities of today. Not simply because of my party's unstinting support for Israel through the decades, but also because it's something I feel very deep inside of me," he said. Speaking about the peace process, Cameron reaffirmed his commitment to a two-state solution, "two democracies, living side by side, in peace" saying he believed there is no sustainable alternative. "A state of Israel, with her existence recognized by all her Arab neighbors and a state for Palestine, with her existence recognized by the world," he said. "I'm not starry-eyed about this, I know peace will not come overnight. It's going to take perseverance, dedication and compromise from all sides. Israeli leaders of all political traditions have in the past shown that they are willing to take risks for peace. "Menachem Begin made peace with Egypt. Yitzhak Rabin and Shimon Peres forged a historic agreement with the PLO. Ariel Sharon and Ehud Olmert have both recognized the demographic reality that unless a Palestinian state were created Israel's nature as both Jewish and democratic would be at risk," Cameron said. He welcomed Prime Minister Binyamin Netanyahu's speech last week but said that the expansion of settlements fueled extremism. "Israel needs to be as brave again today, and that's why Prime Minister Netanyahu's speech talking of a two-state solution was such an important and welcome statement. I agree that Israel must be assured that any withdrawal from territory will not lead to rockets showering down on innocent men, women and children, as has happened all too often in the past and in the present. "But I need to add something else as a true friend. The expansion of settlements fuels extremism and undercuts Palestinian leaders who genuinely yearn for peace. It is in all our interests to help improve life for ordinary Palestinians." Cameron also called on the Palestinians to prove that they were a reliable negotiating partner and that corruption needed to cease. Cameron also offered an insight into how his party intends to deal with Hamas. "Israel is a democracy - Hamas want to create a theocracy. Israel strives to protect innocent life - Hamas target innocent life. And so there can be no doubt, and let me make clear we won't judge Hamas just on words. Our test is whether their actions show that they are going to end the terror, recognize Israel and accept all previous peace agreements." Addressing anti-Semitism, he said he would "stand firm" against it in all its forms and wherever it occurs, and said he found US President [Barack] Obama's speech in Cairo moving. "There he was, in the historic center of the Arab world - where too often vile stereotypes of Israel and Jews go unchecked and unchallenged - and yet he made the fullest expression of the historic suffering of the Jewish people and the abhorrence and ignorance of anti-Semitism." Britain needed that sort of leadership, he noted. "These are incredibly worrying times for the Jewish community in Britain. Anti-Semitic incidents have increased by 10 percent. The BNP are winning seats in both European and local elections and the most disgusting literature can be bought in our bookshops and found in our university campuses." He also said that Gordon Brown's government was not doing enough to fight anti-Semitism. "[Islamist group] Hizb-ut-Tahrir is still not banned. And then there are the decisions that in my view completely fly in the face of common sense. They blacklist an American shock jock [Michael Alan Weiner] but they let in anti-Semites like Yusuf al-Qaradawi and Ibrahim Moussawi with open arms. These people should not be allowed to spread hate in our country."