Israel Broadcasts Interview With Hostage Cleric : Mideast: Sheik Obeid appeals for release of Israeli pilot in exchange for his freedom.

In a late-hour attempt to free a flier missing for five years, Israel broadcast a videotaped interview Monday with Sheik Abdel Karim Obeid, in which the imprisoned Muslim cleric appeals to hostage-holders in Lebanon to release the Israeli airman in exchange for his freedom.

Obeid was abducted in south Lebanon in 1989 for use as a bargaining chip to get back seven missing Israelis. Only one of the seven, air force navigator Ron Arad, is believed to be still alive. Israeli negotiators have worked doggedly to have Arad included in the recent round of hostage releases brokered by the United Nations. All the U.S. hostages now have been freed, as well as other Westerners believed still alive--save for a pair of Germans.

“I am not opposed to the release of Western hostages or any other hostages,” said the bearded Obeid. “But it should not be separated from my issue and those of my brothers being held, and, of course, from the pilot who is held, of course, in Lebanon.”

A Defense Ministry official said the broadcast did not indicate a deal is near; if anything, it indicated the opposite. “Things aren’t going well,” he said.

The interview, the first ever by Obeid, was taped two weeks ago when it appeared that Israel was being left out of the fast-moving hostage negotiations.

Since then, the last three Americans in captivity have been freed, including Terry A. Anderson, the chief Middle East correspondent for the Associated Press and the longest-held U.S. hostage. Before the release of Anderson, Joseph J. Cicippio and Alann Steen, the Israelis freed 25 Lebanese prisoners in response to a “personal appeal” from U.N. Secretary General Javier Perez de Cuellar.

The only word received about Arad was a statement from a Shiite militia leader in Lebanon that he was in Syrian hands. The report was treated with skepticism here. Nothing was heard about three other soldiers who are believed dead and whose bodies Israel is committed to retrieving. As part of previous hostage deals, Israel obtained information on the death of two missing soldiers and repatriation of the body of a third.

Obeid expressed anxiety that his case was being shunted aside, saying: “Those who stated and decided on their sincere intent to release prisoners . . . are requested to return to the right path. . . .”

Obeid--dressed in a black, gold-trimmed robe and a white head scarf--made it clear that any deal must include Arad. “I am being held by a country holding a prisoner, and it is obvious that it will request the release of its prisoners in return for my release,” he said. He also said Israeli officials told him they are willing to free other Lebanese captives. Israel holds about 300 Shiite Muslim prisoners in a prison in south Lebanon, in an area patrolled by an allied Lebanese militia.

Uri Lubrani, Israel’s chief hostage negotiator, is in New York to consult with Giandomenico Picco, the U.N.’s hostage go-between. Meanwhile, Perez de Cuellar announced that he is still working on prisoner releases and hopes to complete all deals before retiring from his U.N. post at year’s end.

The videotape was delivered to Hezbollah, the militant Shiite Muslim militia in Lebanon, shortly after it was made. Israeli officials had planned to broadcast it right after it was made but reconsidered for fear of provoking Iran. With chances for rescuing Arad fading, the Israelis decided to broadcast it anyway. Parts of the interview were broadcast on Arabic- and Hebrew-language news shows.

The broadcast is bound to raise the issue of whether Israel was wise to enter the hostage bazaar by taking a hostage. The use of a videotape is a common practice of hostage-takers seeking to play on emotions of relatives and to influence foreign governments.

In Obeid’s interview, he is asked which of his five children he misses the most; he says it is his 3-year-old daughter: “Honestly, ‘I miss the youngest the most of all for the reason that she was 4 1/2 months old when I left her. She . . . probably does not recognize me.”

When Obeid was taken from his village by airborne troops, the Israelis announced that he would be freed if the missing Israeli soldiers were. The Israelis then expanded the deal to include others. They were confident that Obeid, described as a regional militia leader, would set off bargaining.

But the Shiite response was brutal. Hostage-takers released pictures of Lt. Col. William R. Higgins and said they had hanged the American hostage in retaliation. Later, U.S. experts said Higgins had been dead for some time and his body had been frozen. Shiite extremists also threatened Cicippio’s life.

The incident raised tensions with Washington, which has long preferred diplomatic efforts over direct action to free the hostages. The government of Prime Minister Yitzhak Shamir did not tell Washington about Obeid’s abduction before it occurred.

Israeli governments are under heavy domestic pressure to retrieve soldiers lost in battle, dead or alive. Arad was shot down over Lebanon in 1986 and reportedly was in the custody of a pro-Syrian militia and later handed over to a pro-Iranian group. In recent weeks, officials here have offered double-edged advice to Iran and their Lebanese allies: If Arad is returned, they promise no retaliation. If he is not, Israel will hit southern Lebanon.

Meanwhile, the Palestinian uprising entered its fifth year Monday with armed Jewish settlers attacking property in Ramallah, a town north of Jerusalem where a settler was killed by Arabs. The settlers warned Palestinian residents that further attacks would not go unpunished.

Israeli soldiers also shot and seriously wounded two Arabs during Palestinian protests and a general strike to mark the bloody revolt against Israel’s occupation of the West Bank, Gaza Strip and East Jerusalem. As on previous anniversaries, the army prevented the 1.75 million Arabs of the territories from entering Jerusalem to avert unrest. It also clamped curfews on about 800,000 Palestinians in towns and refugee camps.