A picture shows Damascus gate in Jerusalem's Old City on April 24, 2017.(Xinhua/AFP Photo)

JERUSALEM, May 3 (Xinhua) -- Israel said Wednesday it will cut one million dollars in funding to the United Nations over the approval of UNESCO resolution critical of Israel's policy in Jerusalem a day earlier.

On Tuesday, the United Nations Educational, Scientific and Cultural Organization (UNESCO) passed a resolution that criticizes Israel over its continuing archeological excavations in East Jerusalem's Old City, a territory that Israel seized from Jordan in the 1967 war.

Israel reacted angrily, with Prime Minister Benjamin Netanyahu denouncing the resolution as "delusional" at the cabinet meeting on Wednesday.

"In wake of the resolution, I have instructed Foreign Ministry Director General to deduct one million dollars from the funds that Israel transfers to the U.N.," Netanyahu said.

"Israel will not sit by while the organization calls for the denial of our sovereignty in Jerusalem," he added.

Also on Wednesday, Israel reprimanded the Swedish ambassador because of his country's vote in favor of the resolution.

A statement released by the Foreign Ministry said that Ambassador Carl Magnus Nesser was summoned because Sweden was the only European country to support the resolution.

The Palestinian Foreign Ministry welcomed the resolution, saying the decision points out "the need to confront the dangers posed by the illegal practices of Israel, the occupying power ... which threaten the cultural and historical integrity of these invaluable sites."

Shortly after its occupation, Israel annexed East Jerusalem, claiming it as part of its "indivisible" capital, in a move that has never been internationally recognized.

The resolution, tabled by Qatar, Egypt, Lebanon, Algeria, Morocco, Oman, and Sudan, was passed 22-10 with 23 abstentions.

It deals with Israel's archeological excavations in the Old City, home to Al-Aqsa Mosque, the Dome of the Rock shrine, and ancient Jewish temples.

The resolution, sponsored by Arab countries, addresses Israel as the "occupying power" and urges it to stop "persistent excavations, tunneling, works and projects in East Jerusalem."

According to the resolution, the excavations are a violation of international law.

Israel's arachnological works near and around the site often increase tensions in Jerusalem.

Last year, UNESCO created an uproar in Israel after it passed a resolution that does not mention Jewish ties to the holy sites in Jerusalem. Israel ceased cooperation with the organization in response.