Israel's Netanyahu prepares to present Cabinet

Israel's Benjamin Netanyahu finalised his right-wing government yesterday, a day before presenting it to Parliament amid international concerns over its stance on the troubled Mideast peace talks.

The Prime Minister-designate was to hand out to members of his Likud party the last portfolios in what promises to be one of the largest Cabinets in Israeli history, with officials saying it could have up to 30 ministers.

"Cabinet Secretary-designate Zvi Hauser has already been asked to see that a new government table, big enough to accommodate all of the ministers, would be installed," the Ynet news website reported.

Netanyahu will present his government - Israel's 32nd - for a parliamentary vote this night, a senior Likud official told AFP.

He will preside over a 69-seat coalition in the 120-member parliament that will lean heavily to the right and will have firebrand Avigdor Lieberman, branded by critics as a "racist" for anti-Arab diatribes, as foreign minister.

The coalition comprises Netanyahu's right-wing Likud party with 27 seats, Lieberman's ultra-nationalist Yisrael Beitenu with 15 seats, centre-left Labour with 13 seats, ultra-Orthodox Shas with 11 seats and the far-right Jewish Home settler party with three seats.

Labour leader Ehud Barak is to retain the post of defence minister.

The right-wing shift of the new government has sparked international concern over the future of the peace process, which Israel and the Palestinians re-launched in November 2007 but which has made little progress since.

The EU last week warned Israel of "consequences" if the new government does not commit itself to the principle of the two-state solution to the decades-old Middle East conflict.

"Relations would become very difficult indeed," Karel Schwarzenberg, the Foreign Minister of the Czech Republic that holds the rotating presidency of the EU, said on Friday without elaborating.

US President Barack Obama meanwhile said that peace efforts under Mr Netanyahu cabinet were not getting any easier but were just as necessary. One of the main issues is Mr Netanyahu's opposition to the creation of a Palestinian state - a principle to which Israel committed itself under the 2003 international roadmap for peace plan. Mr Netanyahu, who put the brakes on the Oslo peace process in his first term as Premier in 1996-1999, says economic conditions should be improved in the occupied West Bank before negotiations take place on any other issues.

However, keen not to antagonise main ally Washington where Obama has vowed to vigorously pursue the hobbled peace talks, the new Israeli leader has said he would continue the negotiations.