Israeli far-right minister announces plan to 'bury' idea of Palestinian state

Israeli far-right Finance Minister Bezalel Smotrich announced that work would start on a long-delayed settlement that would divide the West Bank and cut it off from East Jerusalem, a move his office said would "bury" the idea of a Palestinian state.

The Palestinian government, allies and campaign groups condemned the scheme, calling it illegal and saying the fragmentation of territory would rip up peace plans for the region.

Standing at the site of the planned settlement in Maale Adumim on Thursday, Smotrich, a settler himself, said Prime Minister Benjamin Netanyahu and U.S. President Donald Trump had agreed to the revival of the E1 development, though there was no immediate confirmation from either.

 

"Whoever in the world is trying to recognise a Palestinian state today will receive our answer on the ground. Not with documents nor with decisions or statements, but with facts. Facts of houses, facts of neighbourhoods," Smotrich said.

 

Asked about his remarks, a U.S. State Department spokesperson said: "A stable West Bank keeps Israel secure and is in line with this administration's goal to achieve peace in the region," and referred reporters to Israel's government for further information.

The spokesperson said Washington remained primarily focused on ending the war in Gaza.

 

The United Nations urged Israel to reverse its decision to start work on the settlement.

 

"It would put an end to prospects of a two-state solution," U.N. spokesperson Stephane Dujarric told reporters. "Settlements go against international law … (and) further entrench the occupation."

Israel froze construction plans at Maale Adumim in 2012, and again after they were revived in 2020, amid objections from the U.S., European allies and other powers who considered the project a threat to any future peace deal with the Palestinians.

 

Restarting the project could further isolate Israel, which has watched some of its Western allies condemn its military offensive in Gaza and announce they may recognise a Palestinian state.

 

Palestinians fear the settlement building in the West Bank - which has sharply intensified since the 2023 Hamas attack on Israel that led to the Gaza war - will rob them of any chance to build a state of their own in the area.

 

In a statement headlined "Burying the idea of a Palestinian state," Smotrich's spokesperson said the minister had approved the plan to build 3,401 houses for Israeli settlers between an existing settlement in the West Bank and Jerusalem.

 

In Maale Adumim, Smotrich, an ultra-nationalist in the ruling right-wing coalition who has long advocated for Israeli sovereignty over the West Bank, told Reuters the plan would go into effect on Wednesday.

 

Breaking the Silence, an Israeli rights group established by former Israeli soldiers, said what it called a land grab "will not only further fragment the Palestinian territory, but will further entrench apartheid".

 

Nabil Abu Rudeineh, the Palestinian president's spokesperson, called on the United States to pressure Israel to stop settlement building.

Item 1 of 4 Israeli Finance Minister Bezalel Smotrich and a woman hold a map that shows the long-frozen E1 settlement scheme, that would split East Jerusalem from the occupied West Bank, on the day of a press conference near the Israeli settlement of Maale Adumim, in the Israeli-occupied West Bank, August 14, 2025. REUTERS/Ronen Zvulun

"The EU rejects any territorial change that is not part of a political agreement between involved parties. So annexation of territory is illegal under international law," European Commission spokesperson Anitta Hipper said.

 

British Foreign Minister David Lammy said the plan must be stopped.

 

"The UK strongly opposes the Israeli government's E1 settlement plans, which would divide a future Palestinian state in two and mark a flagrant breach of international law," Lammy said in an emailed statement.

 

HOUSE BUILDING 'IN A YEAR'

Peace Now, which tracks settlement activity in the West Bank, said there were still steps needed before construction but infrastructure work could begin within a few months, and house building in about a year.

 

“The E1 plan is deadly for the future of Israel and for any chance of achieving a peaceful two-state solution. We are standing at the edge of an abyss, and the government is driving us forward at full speed," Peace Now said in a statement.

 

Consecutive Israeli governments have initiated, approved, planned and funded settlements, according to Israeli rights group Yesh Din.

 

Some settlers moved to the West Bank for religious or ideological reasons, while others were drawn by lower housing costs and government incentives. They include American and European dual citizens.

 

Palestinians are already demoralised by the Israeli military campaign which has killed more than 61,000 people in Gaza, according to local health authorities, and fear Israel will ultimately push them out of that territory.

 

About 700,000 Israeli settlers live among 2.7 million Palestinians in the West Bank and East Jerusalem. Israel annexed East Jerusalem in 1980, a move not recognised by most countries, but has not formally extended sovereignty over the West Bank.

 

Most world powers say settlement expansion has eroded the viability of a two-state solution by fragmenting Palestinian territory. The two-state plan envisages a Palestinian state in East Jerusalem, the West Bank and Gaza, existing side by side with Israel.

 

Israel cites historical and biblical ties to the area and says the settlements provide strategic depth and security.

 

Most of the global community considers all settlements illegal under international law.

 

Israel rejects this interpretation, saying the West Bank is "disputed" rather than "occupied" territory.

 

Britain, Canada, Australia and New Zealand imposed sanctions in June on Smotrich and another far-right minister who advocates for settlement expansion, accusing both of them of repeatedly inciting violence against Palestinians in the West Bank.