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Australia summoned the Israeli ambassador on Tuesday to protest against Israel's decision to expand Jewish settlements in east Jerusalem and the West Bank and withhold tax revenue from the Palestinian Authority.Australia's move followed similar actions in Europe including Spain, France, Britain, Sweden and Denmark in the wake of the Palestinians winning de facto UN recognition of statehood "Australia has long opposed all settlement activity," Foreign Minister Bob Carr said in a statement after Israeli Ambassador Yuval Rotem's meeting with senior Australian officials. "Such activity threatens the viability of a two-state solution without which there will never be security in Israel."Carr, whose country takes up a rotating UN Security Council seat next year, said Israel's actions had complicated the chances of fresh negotiations between the two sides."I am extremely disappointed with these reported Israeli decisions," he said.Prime Minister Binyamin Netanyahu pushed back on Monday against intense international pressure to reconsider plans for building 3,000 housing units in east Jerusalem and the West Bank and stepping up the planning of the controversial E1 site, saying no one should expect Israel to sit on its hands in light of Palestinian unilateral steps at the UN.As one European country after the next called in their Israeli ambassadors to protest the settlement plans, a source in the Prime Minister’s Office issued a statement saying Israel would “continue to stand up for its vital interests even in the face of international pressure.”The official said there would be no change in the decision made Friday to build 3,000 housing units in the large settlement blocs, and Israel would go ahead with planning and zoning work for the E1 area linking Jerusalem to Ma’aleh Adumim northeast of the capital.“The Palestinian unilateral moves at the UN are a blatant and fundamental violation of agreements to which the international community was a guarantor,” the official said. “No one should be surprised that Israel is not sitting with its arms folded in response to the unilateral Palestinian steps.”The source added that Israel would take further steps if the Palestinians went ahead with more unilateral moves of their own.The plans, however, triggered what one Israeli source described as the worst diplomatic crisis Israel has faced in the last 20 years.White House spokesman Jay Carney told a briefing that the US urged Israel to “reconsider these unilateral decisions and exercise restraint, as these actions are counterproductive and make it harder to resume direct negotiations to achieve a two-state solution. We reiterate our long-standing opposition to Israeli settlement activity and east Jerusalem construction.”