The Palestinian Authority on Wednesday reiterated its position that east Jerusalem is the capital of the Palestinian state.

The announcement came in response to Jerusalem Day and statements by Prime Minister Binyamin Netanyahu to the effect that Jerusalem would remain the eternal and undivided capital of Israel

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Nabil Abu Rudaineh, spokesman for PA President Mahmoud Abbas, said that there would be no peace agreement with Israel without east Jerusalem becoming the capital of the Palestinian state.

Meanwhile, Abbas met in his office in Ramallah with 250 Israelis. The meeting was organized by a Palestinian committee entrusted with maintaining contacts with Israelis.

Mohammed al-Madani, head of the committee, said that the Israeli delegation consisted of political activists, businessmen and journalists who support Palestinian rights.

Abu Rudaineh said that the Palestinian position was shared by the Arabs and the rest of the international community.

He cautioned that Israel's refusal to accept this position would have "grave consequences and would not contribute at all to prospects of achieving peace."

The spokesman also warned that Netanyahu's remarks about Jerusalem would place obstacles before American efforts to revive the peace talks between Israel and the Palestinians.

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