By Luke Baker JAB'A West Bank (Reuters) - The rocky valley **rth of Jab'a, scattered with olive and pine trees and dry streams long evaporated by the searing heat, would be unremarkable had it **t become the latest point of friction between Israel and the Palestinians. Days after a ceasefire was reached in the war in Gaza last month, Israel an**unced that 400 hectares (988 acres) West of Bethlehem, in the occupied West Bank, was **w "state land" - that is territory for Israel, **t land that will be part of any future Palestinian state. Peace **w, an Israeli human rights group, described it as one of the biggest land grabs by Israel since the 1980s. The United States, the European Union, the U.N. and Japan lined up to condemn the appropriation, in an area where 20,000 Palestinians live in 10 villages and which Israel says it intends to keep in any final land-for-peace agreement.