Israel government to form coalition with far-right Avigdor Lieberman

Far-right Israeli politician Avigdor Lieberman could join Prime Minister Binyamin Netanyahu's coalition government, in what could be a fatal blow for chances of new peace talks.

Netanyahu reportedly held talks with the ultra-conservative MP on Wednesday. who had previously called for the beheading of Palestinian citizens of Israel.

This is despite Labour leader Isaac Herzog earlier saying he might be willing to join Netanyahu's right-wing coalition to rescue hopes for peace talks with Palestinians.

But Netanyahu's Likud party and the six-seat extremist Israel Beitenu party of Lieberman have established a joint negotiating team for the 61-member coalition. It makes it likely that Israel could form a radical far-right government that is hostile to peace with Palestinians in a matter of days.

Far-right

Since forming his government a year ago, Netanyahu has made it clear that he wishes to expand his slim majority in Israel's 120-member parliament.

Months of secret talks between Netanyahu and Herzog, whose party forms the Zionist Union along with the centrist Hatnuah, made headlines in recent days.

The Labour leader believes that a unity government between the largest left and right political groups could help advance peace with the Palestinians.

However, a dramatic turnaround took place on Wednesday when Lieberman - who has branded Netanyahu's coalition as "defeatist" - said he would be open to joining Netanyahu's team if key demands were met.

We won't negotiate in parallel to Lieberman - Isaac Herzog, Labour leader

Moments later, and Netanyahu summoned him for a meeting.

Herzog said Netanyahu now faces "a historic choice" to "either embark on a journey of war and funerals" with Lieberman or choose a path of "hope for all (Israeli) citizens".

"We won't negotiate in parallel to Lieberman," he stressed.

Labour withdrawal

Herzog also hit out at opponents from his party of a Likud coalition, describing them as "violent extremist left-wing elements" who had thwarted his talks with Netanyahu. 

However, he said he would make life for the prospective far-right coalition "a nightmare".

Lieberman is viewed as a maverick and extremist by many in Israel. He has made his distrust for Palestinian Authority President Mahmoud Abbas clear.

One of his most controversial moments was when he called for the beheading of Palestinian citizens of Israel, and when the Palestinian Authority called for his arrest for inciting hatred he threatened "they will get a response from me as defence minister".

He also vocally supported an Israeli soldier accused of killing an unarmed, wounded and immobile Palestinian man.

Agencies contributed to this story.