Israeli prime minister Benjamin Netanyahu has said that he would seek to pass a fresh Basic Law that would define Israel as a Jewish state, in defiance to the Arab citizens who make up a fifth of the total population.

"I will promote a Basic Law that will define Israel as the nation-state of the Jewish people," Netanyahu said in a speech in Tel Aviv, adding that the most "basic ingredient in our national lives will win legal status just as other central ingredients that constitute our fundamental core that have already been ruled into the Basic Law of Knesset."

Israel has adopted a series of Basic Laws instead of a formal constitution since its founding in 1948. The concept of Israel as a Jewish state is a definition that was included in the Declaration of Independence.

Attempts to define it as a Jewish state would satisfy the right wing parties in the country which are lobbying to the Supreme Court to force it to give Israel's Jewish identity priority over its democratic one, but likely alienate the 20% of Arab Israelis.

Justice minister Tzipi Livni criticised Netanyahu's announcement and said that she "will not "allow the damaging, weakening or subjugating of [Israel's] democratic values to its Jewish values – this is the substance of the Declaration of Independence and the basis of our existence".

Livni has opposed such legislation before and will do so "even if its author is the prime minister", her office added.

The prime minister assured that Israel "will always preserve full equal rights, both personal and civil, of all citizens of the state of Israel, Jews and non-Jews as one, in the Jewish and democratic state".

However, Arab lawmaker Mohammad Barakeh, from the left-wing Hadash party, said that kind of legislation would be racist in nature. "The truth is, I was surprised by his intention to bring this as a Basic Law," Barakeh told Reuters.

"I have been following Netanyahu's actions in the peace talks. I know he doesn't want peace and wants to put a spanner in the works. But he's gone too far with this."

There are an estimated 1,658,000 Arab citizens in Israel, a figure which represents 20% of the total population.