Announcement comes after lengthy dispute between leading Tories and Liberal Democrats over restriction of arms sales

The British government will suspend some of its arms exports to Israel if hostilities resume in Gaza due to concerns that the British-made products could be used by the Israel Defence Forces (IDF).

The business department said a review of UK exports to Israel had identified the 12 licences for "components which could be part of equipment used by the Israel Defence Forces in Gaza". They include equipment for military radar, combat aircraft and tanks.

Vince Cable, the business secretary, said: "We welcome the current ceasefire in Gaza and hope that it will lead to a peaceful resolution. However, the UK government has not been able to clarify if the export licence criteria are being met. In light of that uncertainty we have taken the decision to suspend these existing export licences in the event of a resumption of significant hostilities.

"No new licences of military equipment have been issued for use by the Israeli Defence Forces during the review period, and as a precautionary measure this approach will continue until hostilities cease."

The export suspension comes after a long and fierce battle within the coalition over restricting arms sales to Israel. The prime minister, David Cameron, and the foreign secretary, Philip Hammond, have been resisting demands from Cable and the deputy prime minister, Nick Clegg calling for the immediate suspension of exports.

Downing Street had said Israel has a "legitimate right to self-defence", and Britain suspending exports without the support of the rest of Europe would have been little more than an empty gesture which could damage the UK's influence over Israel.

"Our view is that the main focus should be on the bigger picture of trying to get Israelis and Hamas to end the violence," a No 10 official said earlier this week.

The Conservatives' reluctance to take a harder line against arms exports, despite the advice of the Tory Middle East minister, Tobias Ellwood, that at least some arms exports should be halted, has angered many senior figures on both sides of the coalition.

Lady Warsi stood down as a foreign office minister last week in anger at the government's failure to suspend arms exports and condemn Israel's offensives in Gaza.

In her resignation letter to Cameron, Warsi said the government's "approach and language" during the month-long conflict in Gaza had been "morally indefensible".

Export licences worth £42m have been granted to 131 British defence manufacturers since 2010, including components for drones, military radars and armoured vehicles. However, most of the exports cover cryptographic software and military communications equipment.

Details published last month by the Commons committees on arms export controls (CAEC) show one licence has been issued in relation to the US-built joint strike fighter (JSF) programme, which is due to start arriving in Israel from 2016, with the first aircraft becoming operational in 2018.

Arms-control campaigners say that two UK companies, including UAV Engines, were given permission to supply components for the Hermes drones which military experts say have been used in the ongoing conflict in Gaza. According to its website, UAV Engines, a subsidiary of Israeli defence contractor Elbit, manufactures engines for "various size tactical UAVs [unmanned aerial vehicles], target drones and single mission platforms".

Following Operation Cast Lead, Israel's 2008 offensive in Gaza, the UK has admitted that equipment used by the Israeli military during the operation had almost certainly contained British-made components.

More than 1,900 Palestinians and 64 Israeli soldiers have died in the current conflict.

A spokesman for the Lib Dems said: "It is no secret that there has been a difference of opinion in the coalition government on this issue.

"Nick Clegg and Vince Cable have been very clear for some that they wanted to see arms export licences to Israel suspended because of the situation in Gaza.

"This is a coalition and this is as far as we have been able to reach in collective agreement with the Conservatives. It has taken a significant amount of time and effort from Liberal Democrats in government to get us this far.

"What is clear now is that we have agreement that if the current ceasefire ends in Gaza, which we all hope it doesn't, and there was a resumption of significant hostilities, then there would be an immediate suspension of those arms export licences to Israel that give cause for concern."

In a statement issued on Tuesday, the Israeli embassy in London said: "Israel notes the UK's decision to leave in place current criteria for arms export licenses. We share the UK's hope that the current ceasefire will continue and lead to a long term solution. At the same time, should Hamas violate the current ceasefire, as it has previous ceasefires, Israel maintains the right to defend itself, a right which has been recognised and supported by the UK leadership.

"Israel regrets calls to cancel or freeze export licenses, or to condition them on a non-recurrence of hostilities. Political decisions of this nature do not reflect Hamas' responsibility as a serial violator of past ceasefires, and are unlikely to contribute to the goal of negotiating a sustainable solution to the current conflict."

• This article was amended on 14 August 2014 to append a statement issued by the Israeli embassy in London.