Netanyahu races to form government as time runs out

Israeli Prime Minister Benjamin Netanyahu was locked in a last-ditch effort Wednesday to piece together a ruling coalition, with commentators already pondering how long it would last.

Despite more than 40 days of political horse-trading Netanyahu was still seeking to finalise an agreement less than two hours ahead of a legal deadline at midnight (2100 GMT).

Even if he strikes a deal within the time limit which adds the far-right Jewish Home to the alliance his Likud party has already agreed with three other parties, he will still command the loyalty of only 61 of parliament's 120 members, a razor-thing majority bought at the cost of major concessions to his partners.

Analysts say that he will be at the mercy of rebels, caprice, or even a bad cold the first time the coalition faces a crucial vote.

He would then be forced to expand the ruling alliance beyond his natural religious and rightist partners and turn reluctantly to the centre-left Zionist Union party, which has so far said it will sit in opposition.

"Netanyahu is left with an unmanageable situation. The first thing he'll do tomorrow...is take his phone and start working on a coalition with (the Zionist Union)," political scientist Emmanuel Navon, of Tel Aviv University told AFP.

Netanyahu, "is a general without soldiers," Maariv daily wrote.

If the talks with the Jewish Home do not bear fruit by midnight, President Reuven Rivlin will ask another party leader to form a government -- most likely Isaac Herzog, head of the Zionist Union, which won 24 seats in the March election in which Likud took 30.

Jewish Home leader Naftali Bennett is demanding ministerial portfolios for all eight Knesset members of his party.

If Netanyahu can form a government, he is expected to continue his robust foreign policy -- marked by virulent attacks on Iran -- and to maintain a hard line on the issue of concessions to the Palestinians.

Public radio reported at 10 pm (1900 GMT) Wednesday that talks between the sides were continuing.

The main sticking point has been the justice ministry portfolio, which Bennett was demanding but Netanyahu wanted to keep for his rightwing Likud.

By early afternoon, Netanyahu appeared to have capitulated, Israel's main news outlets said, with the portfolio likely to be given to Ayelet Shaked, number three within Jewish Home.

But there was still haggling over the fine details of the arrangement into the late evening.

 - Bad blood -

Bennett had upped his demands on Monday after Foreign Minister Avigdor Lieberman dropped a bombshell by pulling out of the coalition talks, saying his anti-Arab Yisrael Beitenu faction would not join a Netanyahu government.

Lieberman said in a statement Wednesday that it was his last day on the job.

The move piled pressure on Netanyahu who quickly signed an agreement with the ultra-Orthodox Shas party, leaving Bennett's party as the last piece in the puzzle.

Despite the bad blood between Netanyahu and Bennett, commentators said the two would eventually reach a last-minute deal.

But they were unanimous that a government with a majority of just 61 would likely be short-lived.

When Netanyahu called for snap elections in December, it was to put an end to the chronic instability in his existing coalition.

When he was tasked with forming a government, Netanyahu said he wanted to form a six-party coalition of rightwing and religious parties which would command a majority of 67.

But Lieberman's last-minute about-face deprived Netanyahu of six seats and put Bennett in the role of kingmaker.

So far, Netanyahu's Likud has signed up three parties for a coalition with 53 seats: the centre-right Kulanu (10) and the two ultra-Orthodox parties Shas (seven) and United Torah Judaism (six).

Shaked, the Jewish Home MP who will reportedly take the justice ministry, has been at the forefront of efforts to curb the powers of the Supreme Court.

Last year, she tabled a bill which would reduce the court's ability to overturn legislation it finds unconstitutional.

The draft was put together after the court overturned legislation that allowed the state to jail African asylum seekers without trial.