Israeli Prime Minister Benjamin Netanyahu on Monday asserted that those firing rockets into Israel from Gaza will not go without punishment and Israel will do everything possible to prevent them from rearming.

Netanyahu, who was speaking at a meeting with the Middle East Quartet envoy Tony Blair, vowed to retaliate to any attack coming from Hamas, and stressed that Israel's policy towards such kind of attacks has become harsher.

"This is our policy. This is a very different policy that I put in. You don't let them get away with it. And they know that's what we're doing," a statement sent to the press by the Prime Ministers Office quoted Netanyahu, referring to the recent missile exchange between Israel and Gaza.

On Monday morning, Israeli army tank units engaged armed Palestinian militants along the border with the central Gaza Strip on Monday morning, local media reports.

The exchange of fire erupted after an Israeli airstrike killed two Palestinians in northern Gaza.

"We're not going to let anyone arm themselves and fire rockets on us and think that they can do this with impunity," Netanyahu said.

Cross-border hostilities flared-up two weeks ago, following an Israeli airstrike that killed a militant in southern Gaza.

Since then, militants fired dozens of rockets and mortar shells into Israel, while numerous Israeli reprisal strikes against rocket-launching crews killed five militants and wounded others.