Jakarta. Indonesia has denounced Israel's declaration last week of the country as a Jewish nation state, saying it may threatens the possibility of finding a solution to the Israeli-Palestinian conflict.

"The passing of this law has dismissed the rights of Palestinians in Israel," Foreign Minister Retno Marsudi told reporters in Jakarta on Monday (23/07).

The Knesset adopted a law on Thursday that defines Israel as a nation state for Jewish people. The controversial law makes Hebrew the country's national language and gives Jews the right national self-determination.

The law effectively downgrades Arabic as an official language to one with "special status," further stoking fears that it will be used to discriminate against Israeli Arabs.

The Arab minority makes up about 20 percent of Israel's population of 9 million.

Israeli Prime Minister Benjamin Netanyahu described the law as a "defining moment" in his country's history and for Zionism.

Retno voiced concern that the law may make a two-state solution to the Israeli-Palestinian conflict impossible.

Other countries, including Egypt, Saudi Arabia and Turkey, have also criticized the new law.

Turkey denounced it as "racist," while the European Union also expressed concern that it would complicate efforts to achieve a two-state solution, according to a report by Reuters.

Indonesia, which has been a vocal supporter of Palestinian independence, urged the United Nations Human Rights Council in July to accelerate an investigation into human rights violations by Israeli forces.