Israel's Lieberman will not join next government

Israel's outspoken Foreign Minister Avigdor Lieberman said on Monday his Yisrael Beitenu party would not be joining the coalition government being formed by Prime Minister Benjamin Netanyahu, media reports said.

The surprise announcement came just two days before a deadline for Netanyahu to present his new government, which he had hoped would be a rightwing religious lineup with a majority of 67 of the parliament's 120 seats.

"We have reached the clear and unequivocal conclusion that it would not be right from our perspective to join the present coalition," Lieberman was quoted as saying by Haaretz website.

Lieberman's hardline anti-Arab party won six seats in the March elections and had been expected to join Netanyahu's Likud in a government comprising six factions.

Although the move will not prevent Netanyahu from forming a government, it will mean he has only the slenderest majority of just 61 seats.

So far, Netanyahu has only managed to ink two coalition agreements ahead of a midnight (2100 GMT) deadline on Wednesday by which he must have completed his new lineup.

Lieberman, who will step down as foreign minister -- a position he had been expected to retain -- said his departure was related to a dispute over "principles" rather than portfolios.

"Our dilemma was principles," he told reporters, indicating that his party had been promised both the foreign ministry and the immigrant absorption ministry.

"This coalition does not reflect the positions of the Zionist camp, and it is not to our taste, to say the least," he said.

- No plans to topple Hamas -

During the negotiations, Lieberman had reportedly laid down a number of far-reaching demands for his agreement to join the coalition, including full responsibility for dialogue with Washington.

He also demanded to take charge of any future peace process, with the proviso that dialogue be conducted on a comprehensive regional basis and not just bilaterally with the Palestinians, public radio said.

Until now, both highly sensitive matters have been exclusively dealt with by Netanyahu's office.

He also demanded that the government adopt as a strategic goal the removal of the Islamist Hamas movement as the de facto power in Gaza.

Speaking on Monday, he said it was clear that the next government had "no intention of overthrowing the Hamas regime".

He also pointed to delays in passing a bill to enshrine in law Israel's status as the Jewish state -- a highly controversial measure which critics say would institutionalise discrimination against the country's Arab minority.

Lieberman has held the foreign affairs portfolio since 2009, except for a period of around a year when he stepped down to successfully fight corruption charges, returning to office in November 2013.