While most of Israel's settlements in occupied East Jerusalem and the West Bank are built with the government's permission, outposts are constructed without authorisation and are theoretically illegal under Israeli law, but still receive governmental support and financial assistance.
On January 9, Israel ordered a sweeping crackdown in the West Bank after the shooting death of the Israeli rabbi. In a statement, he said the Israeli-issued permits were "nearly impossible to obtain" and that demolitions such as Sunday's, among other Israeli policies, "have created a coercive environment that violates the human rights of residents and generates a risk of forcible transfer".
"Our second policy guideline is to strengthen settlement". Most of the worldwide community considers all Jewish West Bank settlements illegal.
Netanyahu told the Cabinet he had spoken with Yael Shevach, the widow of the murdered rabbi.
"The legalization of the outpost would signal that the government does not intend to advance a final peace agreement, but rather only to extend Israel's hold on the West Bank and to prevent the possibility of establishing a Palestinian state alongside an Israel with secure, internationally recognized borders", said the Peace Now group.
Tamimi, who turned 17 in prison last week, was charged with assault and incitement after she slapped and punched two Israeli soldiers in her West Bank village in December.
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Last year, after Trump took office, the Israeli cabinet for the first time in more than 20 years approved an entirely new settlement, called Amihai, in the Binyamin region of Samaria.
Those without approval are referred to as outposts and are typically populated by hardline religious nationalists who see the entire West Bank as part of Israel.
Past attempts by Israeli authorities to dismantle Havat Gilad have led to clashes with settlers there.
The Palestinian family, however, said Ahmed was still alive.
"All those who employ abominable terror will understand today that these actions will only deepen our hold on the land of our country" she added.