Actually Arabs resident within Israel are citizens.

However refugees from what is now Israel, and their children, have no right to return from exile. Unlike Jews.

That middle verse would be one whose sentiments all exiles, Arab or Jew, might share:

Your skies gaze down in purest blue,
               Palestine, my Palestine;
          And bathe your peaks in brilliant hue,
               Palestine, my Palestine;
          Your dancing waves bring tidings true,
          Your cedars tall the tale renew;
          Your children come again to you,
               Palestine, my Palestine!