The demand for intervention follows international calls for action after the recent decision by the US to move its embassy to Jerusalem, a move which threatens the fragile peace in the region.
The Independent Alliance minister also said he still wants to travel to North Korea, even after the recent controversy surrounding a suggested visit to the rogue state by Independent ministers.
In an interview with the, Mr McGrath spoke passionately about concerns for the Palestinian people, including an outstanding Government pledge to recognise the state of Palestine.
“It is something that we all feel very strongly about and that is something that I put into the programme for government.”
Mr McGrath said Tánaiste Simon Coveney had told him one of the main issues for the Government was prioritising the state of Palestine in 2018.
“We want to make sure that that message goes to the United Nations and we are advocating that at the UN and that is our position. It is non-negotiable; it is a very important issue for us.”
But the Dublin Bay North TD went further and wants sanctions levied against Israel, including a boycott of their goods.
“I don’t like boycotts in my heart because I prefer dialogue and interaction but I think we have reached the stage now and particularly in recent weeks now where [Donald] Trump and the Israelis were saying that Jerusalem will become a capital of Israel. And that has provoked me, that has provoked me very seriously.
“So my personal view is we have to start looking at the whole economic sanctions area now because it just is unfair. The vast majority of the international community, they want to see Palestine recognised, they want to seem treated with respect and their human rights recognised and that’s not going to happen, so I think we have to up it a gear.
“But we have to up it a gear at the UN and at the EU. But also in relation to if it comes to it [boycotting] I will support it.”
Mr McGrath also stood over a controversial plan by three Independent Alliance ministers to visit North Korea. The idea caused uproar and mockery after it emerged alliance colleague John Halligan had contacted the North Korean embassy and that he, Mr McGrath, and Shane Ross intended to visit the nuclear state.
The “peace initiative” trip could still go ahead, insisted Mr McGrath: “I don’t make any apologies about it. I’m not going to go at the moment, but it could happen in the future, yes. If there was an opportunity to make a positive contribution.”
He said constituents did not mind him participating in international politics, as long as most of his focus was on his portfolio and local area. “It’s not an ego trip, no way. I don’t understand why people who are interested in creating a safer world are being regularly attacked.”