Israel stood firm on Sunday on a plan to authorise hundreds of new settler homes in the occupied West Bank before a possible construction freeze, shrugging off a rebuke from Washington.
"The prime minister will decide in the coming days on the building of hundreds of additional housing unitsin order to solve existing problems in various settlements," Transport Minister Yisrael Katz told Israel Radio.
Katz held fast to the plan two days after an aide to Prime Minister Benjamin Netanyahu disclosed the Israeli leader's intention to authorise the new projects before considering a moratorium on new building permits. Some 2,500 housing units are currently being built in West Bank settlements and Israeli officials said their construction would continue.
The settlement issue is a major obstacle in the stalled Israeli-Palestinian peace process and has opened the most serious rift in Israel's relations with the United States in a decade.
US President Barack Obama has been pressuring Netanyahu to halt construction in settlements. Palestinian President Mahmoud Abbas has said peace talks suspended since December and which Washington seeks to restart, cannot resume without a freeze. The White House voiced regret on Friday over the new building plan and said such Israeli actions made it harder to create a climate for negotiations.
But a US official in Washington said the Obama administration believed it was still possible to reach a deal to resume overall peace talks.
Netanyahu, who holds further talks on the settlement issue later this week with US envoy George Mitchell, has resisted a total freeze stipulated by a US-backed 2003 peace "road map" that also commits the Palestinians to reining in militants. A settlement deal could lead to talks at the UN General Assembly this month involving Obama, Netanyahu and Abbas.
In what appeared to be a softening of his position, Abbas said on Saturday he was open to meeting Netanyahu if they discussed "a clear vision with regard to settlements". Netanyahu did not address the settlement issue in his broadcast remarks at an Israeli cabinet meeting on Sunday.
But National Infrastructure Minister Uzi Landau, using Israel's terms for the West Bank, told reporters: "I don't see any reason to stop construction ... in Judea and Samaria." Some 300,000 Israelis live in the West Bank and another 200,000 in Arab East Jerusalem, territory captured in a 1967 war. Some 2.5 million Palestinians reside in the West Bank and aspire to establish a state there and in the Gaza Strip.
Political analysts said Netanyahu's intention to approve new building permits before suspending construction starts was part of a balancing act aimed at avoiding a crisis within his right-leaning government over settlements while reducing friction with Obama. As part of any construction freeze, Netanyahu and Obama have been seeking initial steps by Arab countries to normalise relations with Israel, but Washington has met resistance in the region over who should make the first move.