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The Israeli army said on Monday that it was creating a unified command to police Palestinian areas in East Jerusalem beyond its controversial separation wall.

The Israeli army, the police and the Shin Bet security agency will work over the next two years to improve coordination along the Israeli separation wall which surrounds East Jerusalem on three sides, the army said.

An army brigade will then be placed in charge of villages in the occupied West Bank immediately east of the wall, including Abu Dis and al-Azariya.

"The goal is to create a single regional brigade that will coordinate counterterrorism activities," the army's website said.

Israel says there has been a rise in attacks launched from the area since 2015.

The changes would also cover Palestinian neighbourhoods within Jerusalem's Israeli-designated city limits, including Shuafat refugee camp and Kufr Aqab.

Top Israeli army officers have been drafting the plan for the past year, predating US President Donald Trump's controversial 6 December recognition of Jerusalem as Israel's capital.

Last year, a proposed Israeli bill recommended removing Shuafat camp and Kufr Aqab from the Israeli Jerusalem municipal area and annexing five illegal East Jerusalem settlements.

Israeli Intelligence Minister Yisrael Katz said that the bill would add 150,000 Israelis to Jerusalem's population, strengthening its Jewish majority.

Israel occupied the West Bank, including East Jerusalem, in the Six-Day War of 1967. It later annexed East Jerusalem in a move never recognised by the international community.

Prominent members of Netanyahu's right-wing coalition openly oppose the idea of a Palestinian state and advocate annexing most of the West Bank.