OCCUPIED JERUSALEM: Israel is preventing Palestinian development in parts of the occupied West Bank and East Jerusalem while pouring funding into Jewish settlements, the Human Rights Watch group said Sunday. Its 166-page report focused on Israeli policies in areas of the West Bank where the Palestinian Authority does not hold any sway under interim peace deals and in East Jerusalem, annexed to Israel after its capture in a 1967 war. The rights group called on the United States to penalize Israel by withholding from its massive annual aid a sum equal to the amount the Jewish state gives in subsidies to West Bank settlements. “Israeli policies in the West Bank harshly discriminate against Palestinian residents, depriving them of basic necessities while providing lavish amenities for Jewish settlements,” the report said. It highlighted cases in which it said West Bank Palestinian villages are denied the opportunity to develop electricity and running water and road infrastructure while nearby settlements had all those day-to-day amenities in place. Human Rights Watch said Israel had cited security concerns as a reason for any differential treatment. But Carroll Bogert, a spokeswoman for the group, said Israel was carrying out “systematic discrimination merely because of (Palestinians') race, ethnicity and national origin, depriving them of electricity, water, schools and access to roads”. The group called on the international community to avoid complicity in Israeli breaches of international law, including by cutting assistance to the country. “The United States, which provides $2.75 billion in aid to Israel annually, should suspend financing to Israel in an amount equivalent to the costs of Israel's spending in support of settlements, which a 2003 study estimated at $1.4 billion,” the report said. “Similarly, based on numerous reports that US tax-exempt organizations provide substantial contributions to support settlements, the report urges the US to verify that such tax-exemptions are consistent with US obligations to ensure respect for international law,” it added.