Israel has revived a plan to construct 1,600 new settler homes in the east Jerusalem neighbourhood of Ramat Shlomo that raised US objections when it was first announced in 2010, an official said on Monday.
"In the next two weeks the interior ministry's district committee for Jerusalem will convene to discuss the objections to the programme that was approved for deposit over two years ago," interior ministry spokeswoman Efrat Orbach told AFP.
"The committee will then have to decide which of the objections -- if any -- it accepts, and make changes accordingly," she added, in reference to concerns raised by the public.
The Ramat Shlomo project caused a diplomatic rift between Israel and Washington when it was first announced in March 2010 but it has lain dormant since August 2011.
It was initially announced on March 9, 2010, as US Vice President Joe Biden met top Israeli officials in Jerusalem to boost Israeli-Palestinian peace talks.
Ramat Shlomo is a Jewish settlement in the mainly Arab eastern sector of Jerusalem which Israel seized in 1967 and later annexed in a move not recognised by the international community.
Monday's announcement comes after the United States and European nations expressed their discontent to Israel over its decision to plan 3,000 more settler homes in the West Bank and east Jerusalem after the Palestinians won upgraded status at the United Nations.
Hagit Ofran of Israel's settlement watchdog denounced the decision to advance the Ramat Shlomo plans.
"The government is continuing to advance anything they can," she told AFP. "They're doing everything they can to avoid a two-state solution."
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Jerusalem deputy mayor Yossi Deitch, who is also a member of the interior ministry's district committee, praised Prime Minister Benjamin Netanyahu, who he said was behind the latest development.
Deitch "praised the prime minister for his consent to hold the discussion... which will partially alleviate the apartment shortage and balance the city's demography," a statement from the deputy mayor read.
He called to hold the meeting on December 17 as per schedule, "and not succumb to various pressures," the statement read.
Palestinian president Mahmud Abbas slammed the Israeli decision, and called on the international community to curb the move.
Abbas "strongly condemned the Israeli decision to build new settlement units in Jerusalem, a move that is a challenge to the entire international community," his spokesman Nabil Abu Rudeina said in a statement.
The statement warned the Israeli government against the move, and "called on the US, EU and peacemaking Quartet (which also includes Russia and the United Nations) to take the necessary steps to avoid the collapse of everything."
Earlier on Monday, Israel stated it would not give in to international pressure to halt plans to build new settler homes, including in a highly controversial area of the West Bank near Jerusalem.
"Israel continues to insist on its vital interests, even under international pressure. There will be no change in the decision that has been made," said the source, referring to a decision by Netanyahu to allow 3,000 new settler homes to be built in annexed east Jerusalem and the West Bank.
Some of the construction is to take place in a controversial corridor of land east of Jerusalem called E1, which could effectively cut off the northern West Bank from the south, and ultimately threaten the territorial contiguity and viability of a future Palestinian state.