Israeli Finance Minister Bezalel Smotrich has approved plans for a controversial settlement project that would separate East Jerusalem from the occupied West Bank. The move revives the long-frozen E1 scheme, which has faced international criticism for potentially undermining prospects for a future Palestinian state. The plan includes the construction of over 3,400 homes for Israeli settlers, and has drawn condemnation from Palestinian officials, who called it an extension of displacement and annexation. Peace Now, an organization tracking settlement activity, warned that the project threatens any chance of a peaceful two-state solution, while further steps remain before construction can begin.