Prime Minister Benjamin Netanyahu on Tuesday fervently rejected American and European criticism of his decision to advance plans for 1,060 new housing units in Jewish neighborhoods across the Green Line in Jerusalem.

Netanyahu called the condemnations voiced by the international community "statements disconnected from reality, "I've heard claims that our construction in Jewish neighborhoods in Jerusalem distance peace," Netanyahu said, referring to the U.S. State Department's remarks a day earlier that such actions were "incompatible" with peace.

"The criticism is that it distances us from peace. These statements infuse the empty rhetoric of the Palestinians," said Netanyahu.The EU and the U.S. are applying a double standard when it comes to the Israeli-Palestinian conflict," Netanyahu added.

"When Abu Mazen [Palestinian Authority President Mahmoud Abbas] incites murder of Jews in Jerusalem, the international community remains silent," Netanyahu said. "And when we build in Jerusalem, they become indignant. I don’t accept that. Just as the French build in Paris and the British build in London, Israelis build in Jerusalem. We will continue to build in Jerusalem."

Both the U.S. and the European Union voiced concerns abou the reports of Netanyahu's plans, with U.S. State Department Spokesman Jen Psaki telling reporters: "If Israel wants to live in a peaceful society, they need to take steps that will reduce tensions. Moving forward with this sort of action would be incompatible with the pursuit of peace.”

“We view settlement activities as illegitimate and we are unequivocally opposed to unilateral steps,” Psaki added.

U.S. Secretary of State John Kerry spoke with Netanyahu by telephone following the prime minister's announcement, to discuss the building plan, Psaki said.

The European Union asked for clarifications and said such a decision, if confirmed, would be "ill-judged and ill-timed" and "would call into "serious question Israel's commitment to a negotiated solution with the Palestinians."

“We stress that the future development of relations between the EU and Israel will depend on (its) engagement towards a lasting peace based on a two-state solution," said Maja Kocijancic, a spokeswoman for EU foreign policy chief Catherine Ashton.