Benjamin Netanyahu, Israel's Prime Minister, has cancelled snap elections and formed a national unity government with the largest opposition party in a dramatic deal that would give the hawkish premier a commanding mandate should he choose to strike against Iran.
The surprise deal with Shaul Mofaz, leader of the centrist Kadima party, comes two days after Mr Netanyahu called early elections for September, and puts the Prime Minister at the helm of one of the largest and broadest governments in Israel's history, with a 94-seat majority in the 120-member Knesset.
Mr Netanyahu, who had headed a narrow right-wing coalition dominated by his Likud party, said the deal would stabilise the current government. Emerging rifts with his ultra-nationalist and religious partners had prompted his call for early polls.
Speaking at a joint press conference with Mr Mofaz, he said: "I was ready to go to elections. But when I learned that a very broad government can be established... I realised stability can be restored. That is why I have decided to form a broad national unity government." Mr Mofaz approached the premier a few days ago with the proposal during a condolence visit after the death of Mr Netanyahu's father. Apart from insiders within Likud and Kadima, details of the unity talks were kept secret until the deal was struck early yesterday, taking politicians by surprise.
Analysts handed Mr Netanyahu credit for the deal, which keeps him in power at least until elections in October 2013. The premier said the new political alignment would allow him to overhaul a law allowing Israel's ultra-Orthodox minority to avoid military service, and to reform the electoral system, making it harder for fringe parties to cross the electoral threshold.
But crucially, it gives him a powerful political mandate at a time of heightened tensions with Iran, potentially making it easier for him to convince voters of his credentials to lead Israel in a pre-emptive strike on Iran's nuclear facilities, should he choose to do so. Some analysts noted that Israel's national unity governments have formed in the past at a time of war, and hinted there could be an understanding with Mr Mofaz, a former army chief of staff, regarding a pre-emptive strike on Iran's nuclear facilities. The Israeli leader and his Defence Minister, Ehud Barak, are widely believed to favour such an attack despite opposition at home and abroad.
But the presence of Mr Mofaz, who in opposition had been cautious on action against Iran, could also neutralise domestic criticism should a military strike fail.
The deal could also give the premier a freer hand in negotiations with the Palestinians amid efforts by his pro-settler coalition partners to derail talks, although Mr Netanyahu's commitment to reviving the stagnated peace process also remains in question.
Mr Mofaz, who only two months ago vowed he would never join a government headed by Mr Netanyahu, was harshly criticised for throwing in his hat with Likud.
But with opinion polls showing that Kadima, the largest party in the current Knesset, was heading towards a crushing defeat at the next elections with its 28 seats expected to plummet to only 10 or 11, joining forces with Likud became a matter of political survival.
Some questioned just how much influence Mr Mofaz, who becomes a Deputy Prime Minister, will exercise in the new government.
"This is a very, very cynical kind of political stunt," said Channel 10's Nadav Eyal, adding that the deal meant "the central party in opposition has now become a surrogate of Likud and Netanyahu, and almost no doubt will be completely dependent on the Prime Minister."
Shelly Yachimovich, who becomes the new opposition leader as head of the centre-left Labour party, attacked the deal as a "pact of cowards", calling it "the most contemptible and preposterous zigzag in Israel's political history".
Power players: The new coalition
Benjamin Netanyahu (Likud)
The most influential figure in the new government. Supports pre-emptive strike on Iran. Has blamed his pro-settler coalition partners and the Palestinians for stagnation of peace talks.
Ehud Barak (Independence)
Early elections would have meant the Defence Minister's likely departure from the cabinet, depriving Mr Netanyahu of a powerful ally in pushing for a strike on Iran.
Shaul Mofaz (Kadima)
A former Defence Minister and army chief, he bolsters the cabinet's war experience should Mr Netanyahu push for a strike on Iran. He favours a partial withdrawal from the West Bank.
Avi Dichter (Kadima)
A former director of Israel's Shin Bet security service, who will head the Knesset's Foreign Affairs and Defence Committee. He remains dovish on Iran, believing the US should lead any military action.
UN nuclear inspector killed in Iran
A UN nuclear inspector from South Korea was killed and a colleague was injured in a car crash near a reactor site in central Iran yesterday.
There were no immediate indications of foul play, but the crash is likely to come under intense scrutiny. The official Islamic Republic News Agency said the International Atomic Energy Agency inspector died when the car overturned near a heavy water reactor being built in Khondab, about 150 miles south-west of Tehran.
Iran says the reactor – part of the Arak complex – will be used to produce isotopes for peaceful medical and industrial uses. But the US and others fear that spent fuel from the reactors could be reprocessed into plutonium for a warhead. Iran denies it seeks nuclear weapons.
The news agency identified the dead inspector as Seo Ok-seok and says another inspector from Slovakia was injured in the crash and taken to hospital. AP