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Controversial Israeli projects get OK

Israel gave the go-ahead for two major housing projects on land where Palestinians seek statehood.

Jerusalem on Monday approved the construction of 600 new homes in Pisgat Ze’ev, a neighborhood in the eastern part of the capital that Palestinians deem a settlement.

Separately, the religious Shas party said it had received an understanding from Prime Minister Ehud Olmert that he would lift a freeze on the sale of 800 new homes in the settlement of Beitar Illit, which caters to Orthodox families. The government also gave its permission for new residential units to be built in Beitar Illit.

The announcements coincided with the end of a visit by U.S. Secretary of State Condoleezza Rice to assess progress in Israeli-Palestinian peacemaking.

Rice signaled the Bush administration’s displeasure.

“We continue to state America’s position that settlement activity should stop, that its expansion should stop – that it is indeed not consistent with ‘road map’ obligations,” she said at a news conference alongside Palestinian Authority President Mahmoud Abbas.

But Israel argues that eastern Jerusalem, having been annexed as part of the capital, is exempt from the U.S.-sponsored peace plan’s conditions and that the Jewish state will keep major West Bank settlement blocs – including Beitar Illit – under any peace deal.

“We are not building new settlements and are not appropriating land for new settlements, but Beitar Illit, for example, is not a new settlement,” Olmert told his Kadima Party faction. “Everyone should understand this, and these things have never been hidden. They are part of the negotiations, which will continue to move forward.”

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