Very good move. Apparently Israel being a Jewish state is still controversial after 70 years, so let's enshrine it into law.
The issue is not that Israel should not be considered a Jewish nation state, something that should be pretty obvious. That was the whole point of establishing Israel, wasn't it? The issue is that new law is clearly aimed at downgrading the rights of a sizeable ethnic minority, which is just wrong. Especially if to consider the crap Jews had to deal for centuries from majorities in other countries they inhabited.