Netanyahu's main challenger for PM proposes unity government with rotating leaders

The chief challenger to Israel's embattled Prime Minister Benjamin Netanyahu proposed to lead a unity government with Netanyahu's Likud party.

Blue and White candidate Benny Gantz said Saturday he would head the government for two years and then Netanyahu would lead the following two years if he is acquitted of corruption charges.

Gantz says it's the "only way to avoid unnecessary elections that no one wants."

It was Gantz's first concrete offer to extract Israel from its political impasse since the country's attorney general announced Netanyahu's indictment on Thursday on charges of bribery, fraud and breach of trust.

Netanyahu currently heads a caretaker government after two inconclusive elections. Previous efforts at a power-sharing agreement between the two largest parties failed. Netanyahu has vowed to remain in office.

The 70-year-old conservative Likud party leader denies all wrongdoing and denounced the indictment the first against a sitting Israeli prime minister as an "attempted coup."

A poll aired by Israel's Channel 13 TV found that 56 per cent of Israelis believe Netanyahu cannot continue to govern after being indicted. A total of 35 per cent said he can and nineper cent were undecided.

Under Israeli law, he is under no obligation step down as prime minister. But Netanyahu could soon find himself in the difficult position of trying to win an election while preparing to be prosecuted.

After a national televised address on Thursday night, Netanyahu himself kept a low profile on Friday, posting a tweet with heart and an Israeli flag emojis saying: "Thank you for your support and love. Shabbat Shalom." He later issued a video message undertaking to accept the court ruling in his case.

But Israel's election schedule could work against Netanyahu, Israel's longest serving prime minister after 10 successive years in power plus three years in office in the 1990s.

President Reuven Rivlin on Thursday set a three-week deadline for lawmakers to nominate a new candidate from their own ranks to try to form a new government after Netanyahu and Gantz both failed to do so.

If that also fails to produce a government, an election will be triggered in three months.

A source close to Rivlin said he expected appeals to disqualify Netanyahu as a candidate because of the indictment. If the president does so, Netanyahu could be ejected by Likud.

"Netanyahu's great fear is that, amid the extraordinary constitutional crisis that has been created, and amid the political and legal synchronization, he will emerge as the only member of parliament who cannot do this [form a government]," wrote Tal Shalev, political commentator for Israel's Walla news site.

Two of the three legal cases against Netanyahu involve accusations that he offered media bosses inducements in return for more favourable coverage of his policies and personal conduct. He has dismissed the accusations.