JERUSALEM - Israel has given the green light for the building of 112 new homes in a Jewish settlement in the occupied West Bank despite a partial moratorium on such construction, a minister said on Monday.
The news surfaced as US Vice President Joe Biden arrived in the region, a day after the Palestinians agreed to hold indirect talks with Israel while warning that further settlement growth would threaten the entire peace process.
Israeli Environment Minister Gilad Erdan said the project in the Beitar Illit settlement near Bethlehem was an exception to a partial halt of settlement activity announced in November.
"At the end of last year, the government decided to freeze construction, but this decision provided for exceptions in cases of safety problems for infrastructure projects started before the freeze," he told army radio.
Israel's continued expansion of settlements is one of the biggest obstacles to the resumption of peace talks with the Palestinians, now suspended for more than a year despite months of US-led shuttle diplomacy.
The Palestinians, who had refused to resume peace talks until a freeze on settlements, condemned the latest move and called on the United States to intervene to halt settlement activity in the West Bank and east Jerusalem.
"This was the first item on the president's agenda," chief Palestinian negotiator Saeb Erakat said after a meeting between US Middle East envoy George Mitchell and Palestinian president Mahmud Abbas in the West Bank.
"The president said this cannot stand. We cannot tolerate that each time we have discussions on peace-making the Israeli government tenders more settlements, more incursions, more provocations," Erakat said.
Mitchell praised both sides for agreeing to start indirect talks and said he would return to the region next week to discuss the "structure and scope" of the process.
"We also again encourage the parties, and all concerned, to refrain from any statements or actions which may inflame tensions or prejudice the outcome of these talks," he added.
The new project was revealed a day after the Palestinians grudgingly agreed to four months of indirect peace negotiations with Israel mediated by the United States.
It also came as Biden made his first visit to the region since assuming office, after having stressed that relaunching Middle East peace talks was in the interests of Israel, the Palestinians and the United States.
The Palestinians insist they will only return to direct talks if Israel agrees to completely freeze settlement construction in the West Bank, including annexed Arab east Jerusalem.
The United States initially backed that demand, but has since called on both sides to immediately return to negotiations while routinely criticising Israeli settlement activity in line with longstanding policy.
Erdan played down the chances of a strong US reaction to the latest settlement boost and blamed the Palestinians for stalling peace efforts.
"Secretary of State Hillary Clinton and Vice President Joe Biden know that the key is that the prime minister (Benjamin Netanyahu) is ready at any moment to engage in direct negotiations," he said.
"However, Mahmud Abbas wants to limit the indirect negotiations to four months after months of setting unprecedented conditions for accepting dialogue, and this is not the way to discuss peace."
Israel announced a 10-month moratorium on new building permits for settler homes in the West Bank in November but it excludes east Jerusalem, public buildings and works already under way.
Around a half million Israelis live in more than 120 settlements scattered across the West Bank, including east Jerusalem. The international community considers all the settlements illegal.