Elisha Peleg, head of the conservative Likud group on the city council, told AFP its planning and construction committee had given the green light for construction of 90 housing units in Talpiot East and another 32 in Pisgat Zeev.

"It's no big deal," he said. "It's routine construction, we're always building in Jerusalem neighbourhoods ... does anyone know where the (dividing) line was? It's not Berlin where they had a wall."

On Sunday, the city said it was planning to add 1,400 new homes to the annexed east Jerusalem settlement neighbourhood of Gilo, one of the first and largest Jewish districts in Jerusalem that Israel has built on land captured in the 1967 Six-Day War.

That announcement drew criticism from the international community, from Israeli left-wing politicians and activists, as well as Palestinian condemnation.

"We strongly condemn this Israeli escalation and continued decisions in the area of settlements and the imposition of new facts on the ground," chief Palestinian negotiator Saeb Erakat told AFP.

At the United Nations in New York, Arab ambassadors held talks Monday on when to put before the Security Council a resolution condemning Israeli settlement in the occupied territories.

The Palestinians want the resolution passed to put pressure on Israel's Prime Minister Benjamin Netanyahu over the settlements. But US opposition to the resolution is at the heart of the timetable, diplomats said.

The Security Council is to hold a meeting on the Middle East and the Israeli-Palestinian conflict on Wednesday.

The draft resolution could be submitted for then, but some Arab nations want to wait a few extra days in hope of persuading the United States to support the move.

US-brokered peace negotiations between Israel and the Palestinians have deadlocked over the issue of Jewish settlement in the occupied West Bank and east Jerusalem.

The Palestinians walked out of direct peace talks three weeks after they started in September when Israel baulked at extending a 10-month partial freeze on settlement construction in the West Bank.

They refuse to negotiate with Israel while it builds on land they want for a future state.

In March 2010, the Israeli interior ministry announced plans to build 1,600 settler homes in Ramat Shlomo, a Jewish Orthodox Jewish neighbourhood in east Jerusalem.

The announcement, which came as US Vice President Joe Biden was visiting Israel, provoked fierce American opposition and soured relations with Washington for several months.

earlier related report
Israeli NGO probe 'harms democracy': Peres
Jerusalem (AFP) Jan 17, 2011 - Israeli President Shimon Peres on Monday called on Israeli lawmakers to oppose a parliamentary inquiry into the funding of leftwing non-governmental organisations and human rights groups.

Israel's Knesset has yet to define the terms of an inquiry, proposed by a lawmaker from the ultra-nationalist Yisrael Beitenu party of Foreign Minister Avigdor Lieberman.

But, as proposed, it would look into the funding of groups accused of working to bring Israeli military personnel and politicians before international tribunals on allegations of war crimes.

In a statement, Peres "called on the Knesset to reject the proposal," saying it was inappropriate for politicians to serve in judgement.

"The investigation of organizations and foundations, whether from the left or right, must be left to law enforcement authorities," he said. "They possess expertise, are objective, and hold the appropriate investigative tools."

"The establishment of such a parliamentary investigative committee harms Israeli democracy and is unnecessary," he added.

The proposed inquiry sparked a firestorm in Israel, with critics accusing its sponsors of a "witchhunt" against groups whose political views they oppose.

But supporters say Israeli groups are weakening Israel's standing in the world by helping build cases against members of the Jewish state's military.

Israeli military officers, politicians and officials have been targeted overseas by war crimes warrants brought by pro-Palestinian campaign groups.

Ex-foreign minister Tzipi Livni reportedly cancelled a trip to London in December 2009 after a British court issued a warrant for her arrest over Israel's war in Gaza earlier in the year.

The Jewish state also delayed a visit by senior military officers to Britain last January amid fears they could be arrested.

Sponsors of the inquiry have named human rights group B'Tselem, soldiers' testimony network Breaking The Silence and checkpoint monitors Machsom Watch as among those they want scrutinised.

In the past, critics have accused the rights groups of receiving funding from countries and organisations hostile to Israel.

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