Israeli Prime Minister Benjamin Netanyahu has vowed ahead of a trip to the United States that there would be no Israeli concessions on settlement building in east Jerusalem.
Netanyahu made the comments as US envoy George Mitchell arrived in Israel on Sunday on a new mission to try to revive peace talks between Israel and the Palestinians.
Speaking ahead of the weekly cabinet meeting he said Israeli policies concerning construction have not changed over the past 42 years, and were the same in Jerusalem and in Tel Aviv.
"Our policy on Jerusalem is the same as all previous governments of Israel for the last 42 years, it has not changed," said Netanyahu.
"As far as we are concerned building in Jerusalem is the same as building in Tel Aviv and this is something we have made very clear to the US administration," he said.
The hardline prime minister said he had spelled out his position in a letter to US Secretary of State Hillary Clinton, who had demanded a series of Israeli steps to end a crisis over Israeli building the Holy City.
Israel and the US have been at loggerheads for the past two weeks since Israel announced plans to build 1,600 new homes for Jewish settlers in east Jerusalem during a visit by US Vice President Joe Biden.
Clinton demanded and received a response from Netanyahu - which came while she was in Moscow to consult with international partners on the peace process - about US concerns over the impact of the settlements.
Netanyahu's office said he had suggested "mutual confidence-building measures" that could be carried out by Israel and the Palestinians.
Netanyahu also said on Sunday that Israel had agreed that all issues could be discussed at planned indirect, or proximity, talks that were delayed by the settlement row, reportedly another US demand.
"We have also made clear that in the proximity talks both sides can raise any issues that are in dispute," he said.
"But a real solution to the basic problems between us and the Palestinians can only be solved during direct talks and peace negotiations.
"Only if we are sitting together can we reach joint solutions. That is the only way we can reach a real peace agreement."
Netanyahu was to meet later on Sunday with US peace envoy Mitchell before flying to the United States to address the annual meeting of AIPAC, the pro-Israel lobby in Washington.
Last week Mitchell postponed a visit to Jerusalem amid the controversy.
Mitchell is also set to hold talks with Palestinian authority chairman Mahmud Abbas on Monday to keep alive the agreement Israel and the Palestinians made to hold indirect peace talks.
In protest at the settlement announcement, the Palestinians had threatened to call off the resumption of indirect talks with Israel.
Peace talks have been frozen since Israel's invasion of the Gaza Strip in December 2008.
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