Warning that anti-Semitism on rise in Aust

The head of a leading Jewish group has welcomed the Abbott government's decision to dump plans to dilute race-hate laws.

The head of a leading Jewish lobby group has warned of a rise in anti-Semitism in Australia, saying legitimate political protests are being hijacked and turned into displays of racial hatred.

"There definitely has been a rise not only in Europe but here in Australia and that is of great concern," the chief of the NSW Jewish Board of Deputies, Vic Alhadeff, said on Wednesday.

In Sydney on Sunday, about 10,000 people rallied at a park in the city's eastern suburbs in support of Israel, while thousands descended on the city centre to support Palestine in the wake of the one-month conflict that killed 67 in Israelis and more than 1870 Palestinians.

Mr Alhadeff, who has welcomed the Abbott government's decision to dump plans to dilute race-hate laws, insists free speech and political protests were a "democratic right".

"We all have a right to protest, we all have a right (to) express differing opinions. That should always be done respectfully and peacefully," Mr Alhadeff told AAP.

"What we have seen here in Sydney, however, in the last few weeks is political protest seguing into racial hatred, into anti-Semitism here on the streets of Sydney."

"We have seen swastikas here on the streets of Sydney, we have seen the flags of proscribed terrorist organisations on the streets of Sydney. That is clearly a matter of concern."

Mr Alhadeff refused to reveal details of any direct threats to Jewish people.

The comments came as Prime Minister Tony Abbott on Wednesday defended the decision to dump plans to repeal section 18C of the Racial Discrimination Act, which makes it illegal to offend, insult or humiliate a person based on their ethnicity, saying he wanted to preserve "the unity" of the country.

"I want to crack down on the kind of incitement to terrorism which we are now seeing in our community," Mr Abbott said on Wednesday.

"I want the different communities of Australia to be our friends, not our critics, when it comes to cracking down on terrorism and cracking down on things that aid and abet terrorism and, as I said, the 18C proposal was becoming a needless complication."

But Mr Abbott was also criticised by the head of the Arab Council of Australia, Randa Kattan, for confirming the backflip on 18C as he also announced a second tranche of legislation aimed at countering home-grown terrorism.

"On one hand he's saying, 'We recognise that these [laws] have been problematic and the community has made it clear that they're against the laws, but at the same time let's point the finger at particular communities, let's point the finger and play into the prejudices against Arabs and Muslims'," Ms Kattan said.

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