The Jordanian government on Monday rejected Israeli Prime Minister Benjamin Netanyahu's claim that Jerusalem would remain the undivided capital of Israel and that the Jewish state has a free hand to set up settlements throughout the West Bank.

"The West Bank, including East Jerusalem, are occupied territories according to several resolutions issued by the United Nations," Minister of State for Media Affairs and Communication Nabil Sharif was quoted as saying by the official Petra news agency.

"In particular, the UN Security Council resolution 242 of 1967 and resolutions 476 and 478 of 1980 consider Israel's annexation of East Jerusalem null and void and call on Israel to end its occupation of East Jerusalem."

He said that remarks made Sunday by the Israeli government about Jerusalem were nothing more than "fallacies that negate the well- established legal and political realities" and place obstacles "in the path of peace and US efforts that seek to establish peace through the realization of the two-state vision."

Sharif was responding to Netanyahu's assertion during a cabinet meeting that Jerusalem would remain the undivided capital of Israel.

The Israeli prime minister rejected a US call on Israel to cancel a plan to build 20 housing units on the site of the Shepherd Hotel in the Arab neighbourhood of Sheikh Jarrah.

Israel captured East Jerusalem and the rest of the West Bank from Jordan in the 1967 Middle East war.

According to the Association of Civil Rights in Israel, since annexing East Jerusalem, Israel has expropriated 24,500 dunams (6,054 acres) privately owned by Palestinians. By the end of 2007, some 50,197 housing units had been built for Jews on the expropriated land, but none for Palestinians.

In a related development, Jordan's state-funded National Centre for Human Rights said Monday that calling Israel a Jewish state "runs counter to the international criteria of human rights as enshrined in the relevant international declarations which ban all forms of discrimination."

The NCHR said that the move by the new right-wing Israeli government to force Arabs to recognize the Jewish nature of Israel as a precondition for resuming negotiations with the Palestinians "implied racial and colonial connotations that lead to the deportation of Palestinian Arabs living in Israel from their land and homes."