Israel PM's rival rejects conditions for forming government Israel's centrist Blue and White party has rejected what it says are demands from Prime Minister Benjamin Netanyahu to form a unity government under his leadership with his right-wing and ultra-Orthodox Jewish allies

JERUSALEM -- Israel's centrist Blue and White party, which won the most seats in elections earlier this month, on Friday rejected what it said were demands from Prime Minister Benjamin Netanyahu to form a unity government under his leadership with his right-wing and ultra-Orthodox Jewish allies.

After talks with Netanyahu's Likud, the Blue and White party said it "made clear from the outset" that it would reject those conditions, underscoring the daunting task facing Israel's longest-serving prime minister as he struggles to hold onto his post.

"It is clear that the stance taken in setting these two preconditions is aimed at dragging the state of Israel into a third round of elections, in line with the interests of the prime minister," Blue and White said in a statement.

The centrist party, led by former army chief Benny Gantz, won 33 seats, closely followed by Netanyahu's Likud, with 32. But neither has enough support to assemble a 61-seat majority coalition, and they are fiercely divided over the leadership and makeup of any unity government.

Netanyahu says he is negotiating as the head of a 55-seat bloc that includes his allies, while the Blue and White says it is only negotiating with the Likud. Gantz has said he will not sit in a government led by Netanyahu while the prime minister faces likely indictment on a series of corruption allegations following a hearing next week. Netanyahu is not required by Israeli law to step down if he is indicted but will face heavy pressure to do so.

President Reuven Rivlin tapped Netanyahu to form the next government earlier this week after failing to broker an agreement between the two deadlocked candidates. Netanyahu has up to six weeks to resolve the impasse.

Former Defense Minister Avigdor Lieberman, who emerged as kingmaker after his party won eight seats, has called for a national unity government shorn of the ultra-Orthodox parties, Netanyahu's traditional allies.

If Netanyahu fails to form a government, Rivlin can then ask Gantz to try. If he doesn't succeed, Rivlin can select another legislator or set in motion what would be the third elections in under a year. The Knesset voted to dissolve itself after April elections when Netanyahu was unable to form a majority coalition, leading to this month's vote, which was itself unprecedented.