Israel on Tuesday criticized a proposed statement by the European Union recognizing East Jerusalem as the capital of a future Palestinian state -- part of the country's growing resistance to efforts to pressure it into reaching a peace deal with the Palestinians in the absence of direct, U.S.-sponsored talks.

The draft statement, which the Israeli daily Haaretz published Tuesday, is to be considered by E.U. foreign ministers next week. Its first point calls for establishment of a Palestinian state "with East Jerusalem as its capital."

Although Europe has long acknowledged Palestinian claims on Jerusalem -- and, like the United States and others, does not recognize Israel's annexation of the city's Arab neighborhoods after the 1967 Arab-Israeli war -- a direct call for a division of the city would take that policy a step further, according to European and Israeli officials.

The draft text does not include reference to any part of Jerusalem as the capital of Israel and was condemned by Israeli Foreign Ministry spokesman Yigal Palmor as "very harmful." The statement "will not help to promote the peace process," Palmor said. "It will only make the European Union's position more marginal and less influential."

European diplomats in Jerusalem said there was significant disagreement among E.U. members over the statement's language. E.U. officials in Brussels and in Israel said they could not comment on an issue that was still being discussed internally.

Debate over the statement reflects the diplomatic vacuum that has developed amid stalled U.S. efforts to renew direct negotiations between the two sides.

The statement, European diplomats said, is in part an effort to push the parties back to negotiations, while also spelling out a unified position among the union's 27 members. Individual European states have discussed initiatives of their own, most notably France, which has raised the possibility of an international conference to restart talks.

Israeli Prime Minister Binyamin Netanyahu has taken steps on his own that he argues are adequate to show he is serious about a peace deal and should bring the Palestinians back to the bargaining table. Most recently, he announced a temporary halt to construction of private homes in the occupied West Bank.

Palestinians rejected that overture in part because it did not extend to Jewish neighborhoods in East Jerusalem, and have said that in the absence of U.S.-brokered talks they would try on their own to build pressure internationally for establishment of a Palestinian state.

While many see little chance of that strategy working -- the United States holds a veto in the U.N. Security Council, and European nations have discouraged the idea of "unilateral statehood" -- Israeli officials are concerned that the new Palestinian tack may leave them isolated.

The current Palestinian strategy "is like pursuing the conflict through other means," Palmor said.