JERUSALEM -- Israel is again facing accusations of trying to sabotage the peace process. The criticism centers on plans to build in Jerusalem, but Israel says the controversy is based on misinformation.
The international firestorm ignited when Israel announced plans for more than a thousand new housing units in Gilo, Jerusalem's third largest neighborhood.
Gilo is just a few miles from the center of Jerusalem. Some 40,000 Israelis live in the quiet community. The area is widely referred to as a "settlement," but Israel says it's just another neighborhood.
"Gilo is definitely not a settlement. No way. It's one of the three largest neighborhoods of Jerusalem," Jerusalem Deputy Mayor Naomi Tsur told CBN News.
CBN News Middle East Bureau Chief Chris Mitchell talked more about Israel and the thorny issues regarding the "the West Bank" and the peace process, on Thursday's edition of "The 700 Club."
Deputy Foreign Minister Danny Ayalon told journalists Israel has a right and a need to build there.
"You can see we are here in the heart of a pulsating vibrant city," Ayalon said. "You look to the west, you look to the east, you look to the south, you see all around us building."
"This is a neighborhood that is an integral part of Jerusalem," he added.
Gilo is mentioned in the Bible during the time of King David, but Palestinians and much of the world consider the neighborhood part of what they call "east Jerusalem."
That term broadly refers to any part of the city that was under Jordanian control from 1948 to 1967.
But Tsur says that's where the misunderstanding starts.
"Because our neighborhoods are so intertwined, we often forget that a neighborhood such as Gilo is on the west side of the northwest axis if we cut through Jerusalem. It's southwest of the city," she explained.
And Palestinians want this area as part of their future capital. For Israel, that's off the table.
"This is Jerusalem. Jerusalem is the capital of Israel. It cannot be divided and it will not be divided," Ayalon said. "And it's very unfortunate that from faraway places people are trying to judge and depict a picture that is completely unrealistic."
--Originally broadcast October 9, 2011.