Beijing to allow visa-free transit trips

BEIJING: China will allow transit passengers from 45 countries including the US, Canada and all members of the EU to spend up to 72 hours in Beijing without a visa from next month, city authorities said.

The move would "strongly spur the development of the tourism industry, speed up building of an international city (and) expand contacts with the rest of the world," the Beijing Tourism Administration said on its website.

The policy only applies to travellers in transit to a third country, and not for return flights to the capital, whose attractions include the vast Forbidden City.

Eligible nationalities include the United States, Canada, European Union countries, Brazil, Argentina, Australia, South Korea, Japan and the United Arab Emirates.

The city will "starting on January 1, 2013, implement a policy allowing foreigners from 45 countries with visas and plane tickets to a third country to transit through Beijing for 72 hours without a visa", the tourism body said.

But travellers would "face punishment" if they left the capital and lawbreakers would be banned for life, Gao Huada, deputy director of the city's exit-entry bureau, was quoted in the China Daily as saying on Thursday.

China's financial hub Shanghai already allows some foreigners in transit to visit the city for 48 hours, its government says on its website, including those from the US, some European countries, Japan, South Korea and Singapore.

Other travellers passing through the country are required to remain in the airport.

Beijing's airport is the second busiest in the world, having handled 47 million passengers in the first seven months of this year, according to the industry body Airports Council International.

Shanghai airport ranks 20th busiest with 26 million travellers during the same period.

- AFP/ck

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Sonia, Manmohan in top 20; Obama most powerful person: Forbes 2012 power list

NEW YORK: Prime Minister Manmohan Singh and Congress president Sonia Gandhi have been named among the top 20 most powerful persons in the world by Forbes magazine in its annual power rankings which placed US President Barack Obama as number one for a second year in a row.

India's richest businessman Reliance Industries chairman Mukesh Ambani and and Arcelor Mittal CEO Lakshmi Mittal also feature in the list that comprises 71 mighty heads of state, CEOs, entrepreneurs and philanthropists who "truly run and shape the world of 7.1 billion people."

Gandhi dropped a notch from last year's list and ranks at number 12 this year ahead of Chinese Vice-Premier Li Keqiang and French President Francois Hollande.

Forbes said the 65-year-old leader of India's ruling political party has the reins of the world's second-most-populous country and tenth-largest economy.

"Son Rahul is next in line to take over India's most famous political dynasty," it added.

Coming in at the 20th spot is Singh, the Oxford and Cambridge-educated economist who is the architect of India's economic reforms.

Singh had ranked 19th in the list last year. "But Singh's quiet intellectualism is increasingly seen as timid and soft," Forbes added.

Ambani, owner of the world's most expensive private residence, ranks 37th in the list. Forbes said the petrochemical billionaire is India's richest and Reliance Industries is the nation's most valuable company.

It however described Ambani's support for disgraced former Goldman Sachs director Rajat Gupta as a "low point" for him in 2012.

Mittal, ranked 47th in the most powerful people list, has a net worth of USD 16 billion but also has "lots of headaches, including S&P and Moody downgrades of his company's debt to junk status." A highlight for Mittal during the past year was carrying the Olympic flame in the 2012 torch relay.

Forbes said 51-year-old Obama emerged "unanimously" as the world's most powerful person for the second year running.

The decisive winner of the 2012 US presidential election, Obama now has four more years to push his agenda even as he faces major challenges, including an unresolved budget crisis, stubbornly high unemployment and renewed unrest in the Middle East.

"But Obama remains the commander-in-chief of the world's greatest military and head of the sole economic and cultural superpower--literally the leader of the free world," it said.

The second most powerful person in the world also happens to be the most powerful woman, German chancellor 58-year-old Angela Merkel. She jumped up from the number four position last year to take the runner-up spot on the 2012 list.

Forbes termed Merkel as the backbone of the 27-member European Union, one who carries the fate of the Euro on her shoulders.

The list also includes Russian President Vladimir Putin at number three, Microsoft co-founder Bill Gates (4), General Secretary of the Chinese Communist Party Xi Jinping (9), Google co-founders Larry Page and Sergey Brin (20), Iran's supreme leader Ali Khamenei (21) UN chief Ban Ki-moon (30), North Korean leader Kim Jong-un (44) and former US President Bill Clinton (50).

Forbes dropped US secretary of state Hillary Clinton from the list this year. Clinton, who had ranked 16th last year, does not feature in 2012 rankings as she is not expected to return to her powerful post for Obama's second term.

It is for the same reason that US treasury secretary Timothy Geithner also does not feature in this year's list.

Pakistan's Chief of Army Staff Ashfaq Parvez Kayani is ranked 28th in the list.

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Study: Drug coverage to vary under health law

WASHINGTON (AP) — A new study says basic prescription drug coverage could vary dramatically from state to state under President Barack Obama's health care overhaul.

That's because states get to set benefits for private health plans that will be offered starting in 2014 through new insurance exchanges.

The study out Tuesday from the market analysis firm Avalere Health found that some states will require coverage of virtually all FDA-approved drugs, while others will only require coverage of about half of medications.

Consumers will still have access to essential medications, but some may not have as much choice.

Connecticut, Virginia and Arizona will be among the states with the most generous coverage, while California, Minnesota and North Carolina will be among states with the most limited.

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Online:

Avalere Health: http://tinyurl.com/d3b3hfv

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Subway Push Murder Suspect Implicated Self: Police

A suspect believed to be responsible for throwing a man into the path of an oncoming New York City subway train who was taken into custody today has made statements implicating himself, police said.

According to Deputy Commissioner for Public Information Paul Browne, the suspect has been questioned by police since at least early afternoon and while the suspect is in police custody, he has not been officially charged.

Police are continuing to question the suspect and more lineups have been scheduled for tomorrow, Browne said.

Police have not released the suspect's name but began questioning him Tuesday afternoon about the death of Ki-Suck Han, 58, of Queens, N.Y.

Han was tossed onto the subway track at 49th Street and Seventh Avenue around 12:30 p.m. Monday after Han confronted a mumbling man who was alarming other passengers on the train platform. Han tried to scramble back onto the platform, but was crushed by an oncoming train.

The suspect fled the station, prompting a police dragnet for a man described by witnesses and see on surveillance video as a 6-foot-tall, 200-pound black man wearing dreadlocks in his hair.

Witnesses tried to revive the victim after he was hit and provided descriptions of the suspect to police.

Dr. Laura Kaplan, medical resident at Beth Israel Medical Center who was standing on the platform during the incident rushed to give Han aid after he was hit, she said in a statement released by her medical practice today.

New York Police Department

Bystanders Pull Mom, Son From Subway Tracks Watch Video

"A security guard and I performed 3-4 minutes of chest compressions. I hope the family may find some comfort in knowing about the kindness of these good Samaritans, as they endure this terrible loss," Kaplan said.

"I would like the family to know that many people in the station tried to help Mr. Han by alerting the subway personnel," she said.

Kaplan said she wanted to console the family of Han, who she called "a brave man trying to protect other passengers that he did not know."

The suspect had reportedly been mumbling to himself and disturbing other passengers, according to ABC News affiliate WABC. Police told WABC that the suspect could be mentally disturbed.

The suspect could be heard arguing with Han just moments before he hurled Han onto the track bed, according to surveillance video released by the police. The suspect is heard telling the victim to stand in line and "wait for the R train."

A freelance photographer for the New York Post was on the platform and said he ran towards the train flashing his camera hoping to alert the train to stop in time, but the train caught Han against the shoulder deep platform wall.

The photographer, R. Umar Abbasi, caught an eerie photo of Han with his head and arms above the platform and staring at the oncoming train.

Han was treated by EMS workers on the platform for traumatic arrest and rushed to Roosevelt Hospital, where he was pronounced dead, according to the Fire Department of New York.

"I just heard people yelling. The train came to an abrupt stop about three-quarters into the station and that's when I heard a man was hit by a train," Patrick Gomez told ABC News affiliate WABC.

Police set up a command post outside the train station Monday night searching nearby surveillance cameras to try and get a clear image of the suspect, reports WABC. They said Tuesday that the investigation is ongoing.

Anyone with information is asked to call Crime Stoppers at 1-800-577-TIPS (8477). The public can also submit tips by logging onto the Crime Stoppers website at www.nypdcrimestoppers.com or by texting their tips to 274637 (CRIMES) then enter TIP577. All calls are strictly confidential.

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Philippines' biggest typhoon kills at least 82, many buried under mud

MANILA (Reuters) - The Philippines' strongest typhoon this year was headed towards tourist destinations on Wednesday after hitting a southern island, destroying homes, causing landslides and killing at least 82 people, but many more are reported dead and missing.

Typhoon Bopha, with central winds of 120 kph (75 mph) and gusts of up to 160 kph (93 mph), was expected to hit beach resorts and dive spots in northern Palawan, the weather bureau said on Wednesday.

Interior Minister Manuel Roxas confirmed 82 people had died and scores were missing after Bopha made landfall on Tuesday.

But the toll is likely to be closer to 100 with police and media reports of other deaths still to be confirmed.

About 20 typhoons hit the Philippines annually, often causing death and destruction. Typhoon Washi killed 1,500 people in 2011.

More than half those confirmed killed, many buried under mud and collapsed houses, were from an area near an army outpost in Compostela Valley province on southern Mindanao.

"We have already accounted 43 bodies and we're still looking for more, including nine soldiers," said Major-General Ariel Bernardo, an army division commander.

BURIED UNDER MUD

Bernardo said two dozen people had been pulled from under layers of mud and were being treated in local hospitals. Video showed dozens of bloodied survivors, their faces covered with thick cake of mud, at a shelter in the province.

Mudslides and massive flooding caused by swollen rivers inundated most farms in Compostela Valley.

"In the town of Nabunturan, our farms were totally wiped out, there was flooding in every barangay (village)," police Major Hector Grijaldo. "All banana plantations were totally wiped out. What we see standing are coconut trees, all others were either uprooted or felled."

Coastal areas in nearby Davao Oriental province also bore the brunt of Bopha's fierce winds and rain.

Rommil Mitra, provincial police chief, said 52 people were reported killed in Boston and Cateel towns, most of them crushed by fallen trees, collapsed homes and flying debris.

"The winds were really very strong," Mitra said. "I was told the force of the wind could even lift an army truck loaded with troops from the ground."

Most of the affected areas remained isolated due to power outages, lack of communications and destroyed roads and bridges. Helicopters were ferrying troops in search and rescue operations.

Tens of thousands of people remained in temporary shelter areas as local officials appealed for food, water and warm clothes for displaced families. Schools remained closed and dozens of domestic flights were suspended on Wednesday.

(Reporting By Manuel Mogato and Rosemarie Francisco; Editing by Michael Perry)

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PSYprise for 'Gangnam Style' fans

SINGAPORE: Tired of 'Gangnam Style'? Certainly not the more than 4000 people who turned up to catch PSY at the free Marina Bay Sands "Give back to Singapore" concert over the weekend.

As for those who can't get enough of the South Korean sensation and weren't fast enough to be among the lucky few to dance with the 'Gangnam Style' star, the good news is that it will take more than just fast fingers and a good internet connection to see PSY live in Singapore again.

Capping his one-night, under one-hour show in Singapore, the sensation from South Korea who repeatedly said he loved the Lion City, announced to whoops and cheers that he'd be back once his new single and album is released in March next year.

By then, more fans will hopefully get to see and hear more of PSY than what was offered at Saturday's open-air event at Marina Bay Sand's Event Plaza.

The gates for the free concert opened two hours ahead of the 8pm show that saw the main star showing up almost half an hour later.

The restless crowd was kept entertained and psyched to PSY's YouTube hit by 26 dancers from O School, a Singapore social enterprise that helps fund the education of teens from low income homes through its dance school.

On stage, the team of young dancers, including 10-year-old Calvin Go, added their own flavour to the now famous 'Gangnam Style' dance routine that was learnt in an hour on the concert day itself, according to Kenny Low, Managing Director of O School.

But there's nothing like the real thing.

When Psy finally took centre-stage, the crowd went wild with shouts of "oppa!", a Korean term of endearment used by females to refer to an older male friend or older brother, and also a key word in the Korean hit song.

And that was as close to 'Gangnam Style' anyone got at the start of the concert as the atypical K pop sensation launched into "Champion".

The single from his third album '3 Psy' released in 2002, seemed a fitting start to the concert organised by MBS that also showcased its adopted charity, O School, that helps keep teens from dropping out of school.

PSY, a college dropout who is now a champion in his own right, later told the crowd laughingly, "I was a really bad student... I got suspended so many times" as he "officially introduced" himself.

"Academically, I was (a) bad student, but creatively, I was (a) good student" was the piece of inPSYration delivered by the 34-year-old who swept four awards at the recent 2012 MNet Asian Music Awards (MAMA) with 'Gangnam Style' after years of being sidelined.

Despite a whirlwind tour of the region before landing in Singapore just hours before his concert, the hyperactive PSY continued to surprise during his appearance.

Even with concert-goers and non-ticket on-lookers standing around the Event Plaza loudly cheering, it wasn't enough for PSY, who suddenly stopped his second song to urge the crowd on.

"Show me energy and I'll show you energy! I want every single person to jump!" he yelled midway into "Right Now", the single from his fifth album "PSYFIVE" released in 2010.

But it seemed that the crowd was saving its energy for one song and of course, the man himself knew what it was.

"This song is called… No, no no, just give me the beat," Psy declared unable to hide the grin on his face as he dived into his third and final song for the night.

That's when the crowd really began to scream, almost drowning out the now-familiar electro-bass beats pounding out of the speakers around the Event Plaza.

Not a word was missed or a move forgotten as the crowd went PSYchotic, shouting the Korean lyrics of 'Gangnam Style' while trying to horse-dance in what limited space they could afford in the sea of sardine-packed bodies.

Adults, teens and even grey-haired elders were seen moving to the infectious tune.

In a flash, the one-hour concert was over.

PSY had been on stage less than three quarters of that time, but fans didn't seem to mind.

"It was a good experience although it was very short" said Yu Ping, a 15-year-old student who got her ticket from a family friend.

"Maybe he's just very busy" said the understanding fan.

Marina Bay Sands which had said that the free concert would happen come rain or shine, was likely glad that Singapore's rainy spell held off for the night and the stars remained in alignment for PSY's one-night appearance.

"We had a slot on our calendar, he had a slot on his calendar" said Mr. George Tanasijevich, President and Chief Executive Officer of MBS of just how the most well-known and in-demand person in the world was clinched for the public event.

"I think it came together pretty quickly", Tanasijevich shared with channelnewsasia.com on the sidelines of the concert.

"Maybe it's a little less strategic than you think it is... It's more opportunistic," he added with a laugh.

It was however, definitely good strategy that allowed MBS' designated charity, O School, to raise its public profile through the event.

"The talents of O School are incredible dancers who demonstrated professionalism and excellent showmanship during the showcase" said Tanasijevich.

And what better reward for the young dancers than being the opening act for PSY? Well, probably the man himself ... with the dancers treated to an exclusive backstage Meet and Greet Session after the concert while the crowds lingered, hoping to spy PSY.

-CNA/fl

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SC dismisses Sangma's petition challenging Pranab Mukherjee's election

NEW DELHI: The Supreme Court on Wednesday dismissed Purno Sangma's petition challenging Pranab Mukherjee's election as the President.

The SC bench said that Sangma's petition did not disclose material to pass the stage of early scrutiny.

A five-judge bench of the apex court decided by 3:2 majority that the petition did not deserve to be entertained for detail trial, which if ordered would have entailed possible cross examination of Pranab Mukherjee.

The SC on November 21 had said that it would take a final call on entertaining former Lok Sabha Speaker P A Sangma's plea, challenging the election of Pranab Mukherjee as President, on December 5.

"Arguments concluded. We shall pass the order on December 5," a five-judge bench headed by Chief Justice Altamas Kabir said after Ram Jethmalani, counsel for Sangma, wrapped up arguments with the claim that the plea deserved a regular hearing, as it affects the "whole nation" because the person who became President would be custodian of the Constitution for next five years.

Mukherjee was represented by eminent lawyer Harish Salve and attorney general G E Vahanvati.

(With inputs from ANI)

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Fossil fuel subsidies in focus at climate talks

DOHA, Qatar (AP) — Hassan al-Kubaisi considers it a gift from above that drivers in oil- and gas-rich Qatar only have to pay $1 per gallon at the pump.

"Thank God that our country is an oil producer and the price of gasoline is one of the lowest," al-Kubaisi said, filling up his Toyota Land Cruiser at a gas station in Doha. "God has given us a blessing."

To those looking for a global response to climate change, it's more like a curse.

Qatar — the host of U.N. climate talks that entered their final week Monday — is among dozens of countries that keep gas prices artificially low through subsidies that exceeded $500 billion globally last year. Renewable energy worldwide received six times less support — an imbalance that is just starting to earn attention in the divisive negotiations on curbing the carbon emissions blamed for heating the planet.

"We need to stop funding the problem, and start funding the solution," said Steve Kretzmann, of Oil Change International, an advocacy group for clean energy.

His group presented research Monday showing that in addition to the fuel subsidies in developing countries, rich nations in 2011 gave more than $58 billion in tax breaks and other production subsidies to the fossil fuel industry. The U.S. figure was $13 billion.

The Paris-based Organization for Economic Cooperation and Development has calculated that removing fossil fuel subsidies could reduce carbon emissions by more than 10 percent by 2050.

Yet the argument is just recently gaining traction in climate negotiations, which in two decades have failed to halt the rising temperatures that are melting Arctic ice, raising sea levels and shifting weather patterns with impacts on droughts and floods.

In Doha, the talks have been slowed by wrangling over financial aid to help poor countries cope with global warming and how to divide carbon emissions rights until 2020 when a new planned climate treaty is supposed to enter force. Calls are now intensifying to include fossil fuel subsidies as a key part of the discussion.

"I think it is manifestly clear ... that this is a massive missing piece of the climate change jigsaw puzzle," said Tim Groser, New Zealand's minister for climate change.

He is spearheading an initiative backed by Scandinavian countries and some developing countries to put fuel subsidies on the agenda in various forums, citing the U.N. talks as a "natural home" for the debate.

The G-20 called for their elimination in 2009, and the issue also came up at the U.N. earth summit in Rio de Janeiro earlier this year. Frustrated that not much has happened since, European Union climate commissioner Connie Hedegaard said Monday she planned to raise the issue with environment ministers on the sidelines of the talks in Doha.

Many developing countries are positive toward phasing out fossil fuel subsidies, not just to protect the climate but to balance budgets. Subsidies introduced as a form of welfare benefit decades ago have become an increasing burden to many countries as oil prices soar.

"We are reviewing the subsidy periodically in the context of the total economy for Qatar," the tiny Persian gulf country's energy minister, Mohammed bin Saleh al-Sada, told reporters Monday.

Qatar's National Development Strategy 2011-2016 states it more bluntly, saying fuel subsides are "at odds with the aspirations" and sustainability objectives of the wealthy emirate.

The problem is that getting rid of them comes with a heavy political price.

When Jordan raised fuel prices last month, angry crowds poured into the streets, torching police cars, government offices and private banks in the most sustained protests to hit the country since the start of the Arab unrest. One person was killed and 75 others were injured in the violence.

Nigeria, Indonesia, India and Sudan have also seen violent protests this year as governments tried to bring fuel prices closer to market rates.

Iran has used a phased approach to lift fuel subsidies over the past several years, but its pump prices remain among the cheapest in the world.

"People perceive it as something that the government is taking away from them," said Kretzmann. "The trick is we need to do it in a way that doesn't harm the poor."

The International Energy Agency found in 2010 that fuel subsidies are not an effective measure against poverty because only 8 percent of such subsidies reached the bottom 20 percent of income earners.

The IEA, which only looked at consumption subsidies, this year said they "remain most prevalent in the Middle East and North Africa, where momentum toward their reform appears to have been lost."

In the U.S., environmental groups say fossil fuel subsidies include tax breaks, the foreign tax credit and the credit for production of nonconventional fuels.

Industry groups, like the Independent Petroleum Association of America, are against removing such support, saying that would harm smaller companies, rather than the big oil giants.

In Doha, Mohammed Adow, a climate activist with Christian Aid, called all fuel subsidies "reckless and dangerous," but described removing subsidies on the production side as "low-hanging fruit" for governments if they are serious about dealing with climate change.

"It's going to oil and coal companies that don't need it in the first place," he said.

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Associated Press writers Abdullah Rebhy in Doha, Qatar, and Brian Murphy in Dubai, United Arab Emirates, contributed to this report

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Karl Ritter can be reached at www.twitter.com/karl_ritter

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Kate's Illness Sometimes Linked to Twins

Hyperemesis gravidarum, the reason newly pregnant Kate Middleton is in the hospital, is a rare but acute morning sickness that results in weight loss and accounts for about 2 percent of all morning sickness, doctors say.

The condition is sometimes associated with women having twins, experts said.

Women diagnosed with hyperemesis gravidarum have lost 5 percent of their pre-pregnancy weight, or 10 pounds, said Dr. Ashley Roman, a professor and OB/GYN at New York University Langone Medical Center.

It poses little danger to the tiny heir, doctors said.

"It's traditionally thought that nausea and vomiting is a sign of a healthy pregnancy," Roman said

Dr. Nancy Cossler, an OB/GYN at University Hospitals in Ohio said the condition does not cause loss of pregnancy or birth defects, but it can be a torture to endure.

"The biggest problem with this is how it interferes with your life," Cossler said. "Constantly feeling sick and puking is difficult."

Click here to read about other women with hyperemesis gravidarum.

Hyperemesis gravidarum is thought to be caused by higher levels of the pregnancy hormone, hCG, or human chorionic gonadotropin, Cossler said. Extra hCG can often be brought on by carrying more than one fetus, she said.

Chris Jackson/AFP/Getty Images

Kate Middleton Pregnant, Admitted to Hospital Watch Video

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In other words, it could be a sign that Middleton is carrying twins. Although there's very little data on twins and hyperemesis gravidarum, one study showed that women carrying twins had a 7.5 percent higher risk of experiencing the acute morning sickness, Roman said.

The extreme morning sickness is usually diagnosed about nine weeks into the pregnancy, and in most cases resolves itself by 16 or 20 weeks, Roman said. In rare cases, it can last the whole pregnancy.

"As the pregnancy is in its very early stages, Her Royal Highness is expected to stay in hospital for several days and will require a period of rest thereafter," a statement from St. James Palace said. Prince William is at the hospital with Middleton, according to the Britain's Press Association.

Click here for photos of Kate through the years.

Roman said doctors prescribe vitamins and ginger capsules at first. If that doesn't stop the vomiting, they will prescribe antihistamines and stronger anti-nausea medications.

Women with hyperemesis gravidarum are also treated with fluids, said Dr. Jessica Young, an OB/GYN at Vanderbilt University. But if left untreated, a pregnant woman who is severely dehydrated for a long period of time could die, "just like any person," Young said.

In extreme cases in which the woman is losing weight and unable to eat, doctors will treat her with intravenous nutrition, Young said.

Hospital stays can vary, and women will often have to be admitted more than once before the condition passes, doctors said.

Hyperemesis gravidarum is somewhat mysterious because some expectant mothers have acute morning sickness during only one of their pregnancies, but have no morning sickness for subsequent pregnancies.

There is a chance that higher levels of hCG, which likely caused Middleton's nausea, could be a sign of a molar pregnancy instead of twins, Cossler said. This would mean Middleton is carrying only a benign growth in her uterus instead of a fetus, or she is carrying a fetus with abnormal DNA and a benign growth. Neither is considered a viable pregnancy.

However, Cossler said molar pregnancies become apparent early on, and doctors would already know whether Middleton had one.

"They would not have released this information," Cossler said of the birth announcement. "I'm certain that they have already eliminated both of those [types of molar pregnancies]."

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Israel says will stick with settlement plan despite condemnation

JERUSALEM (Reuters) - Israel rejected concerted criticism from the United States and Europe on Monday over Prime Minister Benjamin Netanyahu's decision to expand settlement building after the United Nations' de facto recognition of Palestinian statehood.

Washington urged Israel to reconsider its plan to erect 3,000 more homes in the occupied West Bank and East Jerusalem, saying the move hindered peace efforts with the Palestinians.

Britain, France, Spain, Sweden and Denmark summoned the Israeli ambassadors in their capitals to give similar messages.

An official in Netanyahu's office said Israel would not bend. "Israel will continue to stand by its vital interests, even in the face of international pressure, and there will be no change in the decision that was made," the official said.

Angered by the U.N. General Assembly's upgrading on Thursday of the Palestinians' status in the world body from "observer entity" to "non-member state", Israel said the next day it would build the new dwellings for settlers.

Such projects, on land Israel captured in a 1967 war, are considered illegal by most world powers and have routinely drawn condemnation from them. Approximately 500,000 Israelis and 2.5 million Palestinians live in the two areas.

In a shift that raised the alarm among Palestinians and in world capitals, Netanyahu's pro-settler government also ordered "preliminary zoning and planning work" for thousands of housing units in areas including the "E1" zone east of Jerusalem.

Such construction in the barren hills of E1 has never been put into motion in the face of opposition from Israel's main ally, the United States. Building in the area could bisect the West Bank, cut off Palestinians from Jerusalem and further dim their hopes for a contiguous state.

Israeli television stations reported Jerusalem's district planning commission would soon approve plans for several thousand more housing units, including more than 1,000 Israel had shelved two years ago after angering Washington by publishing the plans before a visit by Vice President Joe Biden.

The settlement plan, U.N. Secretary-General Ban Ki-moon said, would deal "an almost fatal blow" to a two-state solution to the Israeli-Palestinian conflict.

French President Francois Hollande said he was "extremely concerned" and Washington made clear it would not back such Israeli retaliation over the U.N. vote, sought by Palestinians after peace talks collapsed in 2010 over settlement building.

"We urge Israeli leaders 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," White House spokesman Jay Carney told a briefing.

Ahead of a Netanyahu visit this week, Germany, considered Israel's closest ally in Europe, urged it to refrain from expanding settlements, and Russia said it viewed the Israeli moves with serious concern.

RETALIATION

Israeli Finance Minister Yuval Steinitz said Israel could not have remained indifferent to the Palestinians' unilateral move at the United Nations.

"I want to tell you that those same Europeans and Americans who are now telling us 'naughty, naughty' over our response, understand full-well that we have to respond, and they themselves warned the Palestinian Authority," he said.

Palestinian chief negotiator Saeb Erekat said building in E1 "destroys the two-state solution, (establishing) East Jerusalem as the capital of Palestine and practically ends the peace process and any opportunity to talk about negotiations in the future".

The United States, one of the eight countries to vote alongside Israel against the Palestinian resolution at the General Assembly, has said both were counterproductive to the resumption of direct peace talks.

In Europe, only the Czech Republic voted against the status upgrade while many countries, including France, backed it. Netanyahu plans to visit Prague this week to express his thanks.

In the Gaza Strip, Sami Abu Zuhri, spokesman for the governing Hamas Islamist movement, called the settlements "an insult to the international community, which should bear responsibility for Israeli violations and attacks on Palestinians".

Israeli police arrested three Jewish settlers on Monday whom they suspect of arson and other crimes against Palestinian property in the West Bank, including the torching of a car.

Attackers have often proclaimed they are exacting a "price tag" for steps taken against the settler movement by Palestinians, or by the Israeli government.

Alongside the settlement plans, Israel announced it would withhold about $100 million in Palestinian tax revenues from the Palestinian Authority, which exercises limited self-rule in the West Bank, saying Palestinians owed $200 million to Israeli firms.

"These are not steps towards peace, these are steps towards the extension of the conflict," Spanish Foreign Minister Jose Manuel Garcia-Margallo said.

Only three weeks ago, Netanyahu won strong European and U.S. support for a Gaza offensive that Israel said was aimed at curbing persistent cross-border rocket fire.

Favored by opinion polls to win a January 22 national election, he brushed off the condemnation and complaints at home that he is deepening Israel's diplomatic isolation.

Netanyahu told his cabinet on Sunday that his government "will carry on building in Jerusalem and in all the places on the map of Israel's strategic interests".

But while his housing minister has said the government would soon invite bids from contractors to build 1,000 homes for Israelis in East Jerusalem and more than 1,000 in West Bank settlement blocs, the E1 plan is still in its planning stages.

"No one will build until it is clear what will be done there," the minister, Ariel Attias, said on Sunday.

Israel froze much of its activities in E1 under pressure from former U.S. President George W. Bush, and the area has been under the scrutiny of his successor, Barack Obama.

Israel cites historical and Biblical links to the West Bank and Jerusalem and regards all of the holy city as its capital, a claim that is not recognized internationally.

(Additional reporting by Crispian Balmer, Dan Williams, Nidal al-Mughrabi in Gaza, Jihan Abdalla in Ramallah, Steve Gutterman in Moscow, Gareth Jones in Berlin, John Irish and Elizabeth Pineau in Paris and Tim Castle in London; writing by Jeffrey Heller; editing by Philippa Fletcher)

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