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The president of Israel's Supreme Court said on Thursday that a judicial reform plan proposed by Prime Minister Benjamin Netanyahu's government would crush the justice system and undermine the country's democracy.

Chief justice Esther Hayut issued the stark warning in response to a plan backed by Netanyahu that includes limiting High Court rulings against government moves or Knesset laws, while increasing politicians' say in selecting judges.

The proposal, Hayut said in a televised speech, "is not a plan to fix the justice system but a plan to crush it".

It will "deal a fatal blow" to the independence of judges and their ability to serve the public, she said.

"The meaning of this plan is therefore to change the democratic identity of the country beyond recognition."

Netanyahu's justice minister, Yariv Levin, later defended the reform he is championing and criticised what he referred to as "a call to set the streets on fire".

He said his plan will restore balance between the branches of government.

The proposal has stirred worry within Israel and abroad that it could be used by Netanyahu or his religious-nationalist coalition partners to pave the way for laws that might encroach on Palestinians, secular liberals and minorities.

Netanyahu, who took office as prime minister again last month, says he will preserve the judiciary's independence.

The longtime leader is on trial for corruption charges he denies.

(Reuters)