Strasbourg, March 10 (IANS) The European Union Wednesday condemned Israel's decision to build 1,600 new houses in east Jerusalem, saying the move could increase distrust between Israel and Palastine.

EU foreign policy Chief Catherine Ashton said the measure rarefies the fragile peace process in the region and can increase distrust.

During a debate on the issue in the European Parliament, Ashton said that she backed US Vice President Joe Biden in condemning the Israeli decision, Prensa Latina reported.

Ashton will Sunday begin a visit to the Middle East, Gaza and Israel.

Referring to Biden's statement, in which he criticised the Israeli stance, she said Palestinian government had refused to start talks because Israel continued with its policies of extending Jewish settlements.