Europe piled pressure on a defiant Israel yesterday over the Jewish state’s plans to build new settlements in east Jerusalem and the West Bank after the Palestinians won upgraded status at the UN.

UN Security Council permanent members Britain and France, as well as Denmark, Spain and Sweden, summoned Israel’s ambassadors to express deep concern and call for the reversal of plans to build 3,000 settler homes in a project that could effectively cut the West Bank in two.

Germany and Russia also critic-ised the Israeli plans, which UN chief Ban Ki-moon warned could wipe out hopes for peace.

But Israel, whose settlement building on occupied Palestinian land has been a constant thorn in the side of efforts to reach a peace deal, would not back down.

“Israel continues to insist on its vital interests, even under inter-national pressure. There will be no change in the decision,” a source in Prime Minister Benjamin Netanyahu’s office said.

Israel has faced a wave of top-level diplomatic protests after the construction proposals emerged on Friday as a form of payback for the Palestinians winning the rank of UN non-member observer state.

Some of the construction is to take place in a contentious corridor of land called E1, an area of the West Bank that runs between the easternmost edge of annexed east Jerusalem and an Israeli settlement, Maaleh Adumim.

France said it had summoned the Israeli ambassador to express its “grave concern” over the plans for the settlement. “Construction in the E1 area would seriously undermine the two-state solution by isolating Jerusalem... from the West Bank and threatening the territorial contiguity and viability of a future Palestinian state,” foreign ministry spokesman Philippe Lalliot said.

Britain’s Foreign Office said it had called in Israel’s envoy to “deplore” the decision and urge Israel to reconsider the plans for new settlements.

“We have told the Israeli Government that if they go ahead with their decision, there will be a strong reaction,” the Foreign Office said.

But London and Paris rejected media reports that they were planning the unprecedented step of recalling their ambassadors to Israel over the plans.

Germany, one of Israel’s closest allies, said it was “deeply concerned” about the settlement plans but did not follow other European capitals in summoning the Israeli ambassador.

“We urge the Israeli Government to reverse this announcement,” government spokesman Steffen Seibert told a media briefing.

He said a Berlin meeting this week between Chancellor Angela Merkel and Netanyahu and most of their cabinets would still go ahead as originally planned.

Russia, a veto-wielding member of the Security Council, also urged Israel to rethink its plans, saying the project “will negatively affect efforts to restart direct talks”.

Palestinians bitterly oppose the E1 project, as it would effectively cut the occupied West Bank in two, north to south, and sever it from Jerusalem, making the creation of a contiguous Palestinian state almost impossible.

Plans to link Jerusalem with the Maaleh Adumim settlement, which lies some five kilometres from the city’s eastern flank, have long been espoused by Israeli hardliners, but were put on hold in 2005 following strong opposition from Washington.

Those behind the plan sought “territorial continuity” between Maaleh Adumim, which is home to some 36,100 Israelis, and the settlement neighbourhoods that ring Arab east Jerusalem.

The plans were resurrected last week following the UN vote, dealing a harsh diplomatic blow to Israel, which vowed to “act accordingly”.

The Government has not given details or a timeframe for the new construction.

Israel has also said that it would not transfer this month’s tranche of millions of dollars’ worth of tax and tariff funds it collects for the Palestinians.

Washington and Brussels also raised concerns about the settlements plan and on Sunday, UN chief Ban Ki-moon issued a strongly worded warning.

“Settlements are illegal under international law. Should the E1 settlement be constructed, it would represent an almost fatal blow to remaining chances of securing a two-state solution,” Ban said.

Peace talks have been frozen since September 2010 largely over the issue of settlements.