Israel on Wednesday granted final approval for a controversial settlement project in the occupied West Bank that critics say would sever Palestinian territorial continuity and effectively end prospects for a future Palestinian state.The plan, known as the E1 project, will see the construction of around 3,500 housing units adjacent to the settlement of Maale Adumim, east of Jerusalem. If implemented, the development would cut the West Bank in two, severing the last geographical link between Ramallah in the north and Bethlehem in the south.Settlement expansion in E1 has been under discussion for more than two decades, but was repeatedly frozen due to US pressure. The international community overwhelmingly regards Israeli settlement activity in the West Bank as illegal under international law and a key obstacle to peace, AP reported.Far-right finance minister Bezalel Smotrich, a former settler leader, framed the move as a direct challenge to recent European decisions to recognize a Palestinian state.“The Palestinian state is being erased from the table not with slogans but with actions,” Smotrich said. “Every settlement, every neighborhood, every housing unit is another nail in the coffin of this dangerous idea.”Prime Minister Benjamin Netanyahu, who has consistently opposed a Palestinian state alongside Israel, has pledged to maintain indefinite control over the West Bank, east Jerusalem, and Gaza, territories seized in the 1967 war that Palestinians seek for their state.Rights group Peace Now condemned the move, saying the E1 project has “no purpose other than to sabotage a political solution.” The group added that while much of the international community is pushing for peace and a two-state solution, Israel’s government is undermining its own national interests.Currently, Palestinians traveling between Ramallah and Bethlehem must take lengthy detours through Israeli checkpoints. In a future Palestinian state, E1 was expected to provide a direct connection between the two cities.Israel’s approval comes amid escalating settler violence, military operations, and restrictions on Palestinian movement in the West Bank, alongside ongoing conflict in Gaza. Over 700,000 Israeli settlers already live in the West Bank and east Jerusalem.The government also approved 350 new housing units in the settlement of Ashael near Hebron. Smotrich, who wields Cabinet-level authority over settlement policies, has vowed to double the settler population in the West Bank in the coming years.Infrastructure work in E1 could begin within months, with construction of homes starting as early as next year.