By Mohammed Assadi

SAKHNIN, Israel (Reuters) - Salwa Abu Jaber believes her story shows Israel discriminating against its Arab citizens, 60 years after the state was established as a haven for Jews.

The 32-year-old mother of four from northern Israel said her five-year-old daughter has never seen her father, who lives in the Israeli-occupied West Bank. Separated from the man for five years, she says she has been forced to divorce him.

Thousands of families have been similarly split by a 2003 ban on Palestinians in the West Bank from reuniting with their families inside Israel, imposed citing security reasons after the Palestinian uprising or intifada began in 2000.

"In practical terms, Israel forced the divorce on us," Abu Jaber said. "We could not continue to live like this any longer. If this is not racism, then what is it?"

This week, as Israel celebrates the anniversary of its foundation, its supreme court has said it found merit in the position of numerous petitions filed by rights groups against the law that keeps the families apart.

But Israeli Arabs -- those Palestinians who remained after hundreds of thousands fled or were expelled from their homes when Israel was created -- say institutionalized racism and illegal killings of Arabs have increased since the intifada started.