The song was written as a poem in 1965 by an individual by the name of Said Al Muzayin, who was arrested by Israelis and was later displaced to Gaza during the Nakba. The song was later adopted by the Palestinian Liberation Organization (PLO). As you can tell, the PLO was guerilla group that sought to drive Israel out of Palestine, along with other groups with the same motive.
At the time, the anthem of Palestine was called "Mawtini" but it was replaced to Fida'i in 1996 and there was no reason given as to why.
The name "Fida'i" means Fedayeen warrior, the Fedayeen was a sort-of umbrella term for nationalist militant and guerilla groups that operated within or out of Palestine. Like the PLO, which fell into that term, the Fedayeen sought to drive out Israel's presence out of Palestine. A lot of these groups were mainly Communist, and often received aid by Communist nations like China and the USSR, who were the largest supporters of the Fedayeen. Aside from attacks against Israel and the west, they were often caught in the cross fire of the wars of surrounding nations like Jordan and Lebanon, Black September and Lebanese civil wars respectively.
My assumption is that the Palestinian state replace Mawtini with Fida'i in order to pay homage and as gratitude to the fighters who've fought desperately for the liberation of their country. Today, the Palestinian people view the Fedayeen as Freedom fighters, while most Israelis... is pretty obvious how they view them
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فِدَائِي فِدَائِي فِدَائِي
يَا أَرْضِي يَا أَرْض الجُدُود
فِدَائِي فِدَائِي فِدَائِي
يَا شَعْبِي يَا شَعْب الخُلُود
فِدَائِي فِدَائِي فِدَائِي
يَا أَرْضِي يَا أَرْض الجُدُود
فِدَائِي فِدَائِي فِدَائِي
يَا شَعْبِي يَا شَعْب الخُلُود
بِعَزْمِي وَنَارِي وَبُرْكَانِ ثَأرِي
وَأَشْوَاقِ دَمِي لِأَرْضِي وَدَارِي
صَعَدْتُ الجِبَالَا وَخُضْتُ النِّضَالَا
قَهَرْتُ المُحَالَا عَبَرْتُ الحُدُود
فِدَائِي فِدَائِي فِدَائِي
يَا أَرْضِي يَا أَرْض الجُدُود
فِدَائِي فدائي فدائي
يا شعبي يا شعب الخلود
عزم الرياح ونار السلاح
وإصرار شعبي بأرض الكفاح
فلسطين داري ودرب انتصاري
فلسطين ثاري وأرض الصمود
فدائي فدائي فدائي
يا أرضي يا أرض الجدود
فدائي فدائي فدائي
يا شعبي يا شعب الخلود
بحق القسم تحت ظل العلم
بأرضي وشعبي ونار الألم
سأحيا فدائي وأمضي فدائي
وأقضي فدائي إلى أن تعود
فدائي فدائي فدائي
يا أرضي يا أرض الجدود
فدائي فدائي فدائي
يا شعبي يا شعب الخلود
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