The Albanese government could announce its decision to recognise Palestinian statehood within days, cabinet sources have confirmed to Guardian Australia.

The confirmation comes hours after the Israeli prime minister, Benjamin Netanyahu – facing growing disapproval over the humanitarian crisis in Gaza – branded Australia and European nations “shameful” for considering recognising a Palestinian state.

He claimed Australia would do “at least what we are doing” if Sydney or Melbourne had been subject to the type of terrorist attack Israel experienced in the 7 October Hamas attacks, when 1,200 people were killed.

Labor was preparing to recognise Palestine before the UN general assembly in New York next month but Monday morning’s cabinet meeting in Canberra looks to be a critical junction in the decision.

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The Sydney Morning Herald and the Age first reported the fast-moving decision on Monday morning.

Australia will match moves by countries including France, Canada and the UK.

The Labor government has been facing demands from inside and outside its party ranks to accelerate its moves to recognise a Palestinian state, with public pressure growing after hundreds of thousands of people marched across the Sydney Harbour Bridge last weekend to protest against Israel’s military campaign in Gaza.

Calls grew at the weekend after Netanyahu’s cabinet announced plans to occupy Gaza – a step the foreign affairs minister, Penny Wong, urged Israel not to follow through on, claiming it could constitute a breach of international law.

Netanyahu, in a press conference overnight, was strongly critical of growing international moves to recognise a Palestinian state. The UK, Canada and France have announced their intention to recognise Palestine.

“To have European countries and Australia march into that rabbit hole, just like that, fall right into it,” he said. “This canard is disappointing, and I think it’s actually shameful. But it’s not going to change our position.”

Netanyahu went on to claim Israel was “actually applying force judiciously, and they know it”.

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“They know what they would do if right next to Melbourne or right next to Sydney you had this horrific attacks. I think you would do it, at least what we’re doing, probably maybe not as efficiently and as precisely as we’re doing it.”

The Liberal senator Dave Sharma, a former Australian ambassador to Israel, said the issue of recognising Palestine should be “quite separate” to growing global outrage about the humanitarian crisis in Gaza, raising concerns about Australia making such a move.

“I think what has happened as a result of many nations making these moves towards recognition is it’s strengthened Hamas’s international position, it’s made Hamas less likely to reach a ceasefire,” Sharma claimed on Radio National.

“It’s made Hamas be able to portray itself as making political progress because of its military actions, and that is actually pushing back the resolution of this conflict, which I think has been a deeply unfortunate consequence, which is why I think those two issues should not be linked.”

More details soon …