The Kurds have ended participation in the Iraqi government, demonstrating a deepening rift between the group and Nouri al-Maliki after the prime minister accused them of harbouring terrorists in the Kurdish capital of Irbil.

Hoshyar Zebari, the foreign minister and a Kurd, told Reuters on Friday that Kurdish ministers were suspending their day-to-day running of his ministry and other posts, leaving Iraq without a president and several ministers. This follows Thursday's announcement by the Kurds that they would boycott all cabinet meetings.

The Kurds are represented in the Iraqi parliament and hold offices in the Shia-led national government, including president, foreign minister, trade minister and health minister. The Kurdish move followed accusations by Maliki that the Kurdish capital of Irbil had become a home to terrorists, a reference to the Islamic State (Isis). In the political chaos following the seizure of much of northern Iraq by Isis, the Kurds have taken the strategic city of Kirkuk and its large oil fields in a move that could pave the way for independence.

"Those (terrorists) and those who host them will lose," said Maliki in his weekly televised address on Wednesday. "We will not stop until we have retaken all the areas that were taken from us."

The boycott may be largely symbolic as the Iraqi government has continued operating in the past when the Sunni bloc fully withdrew its ministers from the cabinet, but it underlines the deepening rift between Maliki and the Kurds, when the prime minister needs all the allies he can muster to confront Isis and disaffected minority Sunnis.

Relations between the Kurds and Maliki have been strained at the best of times, particularly over oil rights and land disputes, yet the the Kurds in the past have provided crucial support to help Maliki win the post of prime minister.

The Isis insurgency, backed by disaffected Sunnis, has brought ties between Maliki and the Kurds to breaking point. After Maliki vented his exasperation with the Kurds, Roz Nouri Shawez, the deputy prime minister and the most senior Kurdish official in the government, told reporters that "such statements are meant to hide the big security fiasco by blaming others, and we announce our boycott of cabinet meetings".

Maliki, whose bloc – called "state of law" – won the most seats in the April elections, has dismissed calls for him step aside, and is intent on having a third term. The result has been political paralysis in Baghdad. Massoud Barzani, the president of the Kurdish region, has blamed Maliki's determination to cling on for the worsening crisis.

"If Maliki insists on a third term, then Iraq will be driven towards a precipice and no one can predict what will happen," he said this week. "And no decision will bring the country back to its previous state."

Iraq's civil aviation authority has suspended cargo flights to the Kurdish region until further notice. The head of the aviation authority, Nassir Bandar, said the decision was taken "due to the security situation and (events) in Mosul where it is not possible for us to handle shipments".

He said passenger flights to the cities of Sulaymaniyah and Erbil will not be affected.