Coalition talks begin after election deadlock

Coalition talks have begun in "Israel" after near-complete general election results gave right-wing and centre-left blocs 60 seats each in parliament.

Shimon Peres is expected to ask Benjamin Netanyahu to attempt to form a new government.

His Likud-Beitenu alliance lost a quarter of its seats in the Knesset but remains the largest grouping with 31.

He has offered to work with the newly-formed Yesh Atid party, which shocked observers by coming second with 19,according to BBC.

However, its leader, popular former TV presenter Yair Lapid, has demanded reform of a law under which ultra-Orthodox Jewish seminary students can defer their military service. Religious parties in the current governing coalition are strongly opposed to any changes.

Mr Lapid has also said he would only join a government that was committed to reviving the peace process with the Palestinians, which has stalled since Mr Netanyahu took office.

"Whoever wants Yesh Atid in the coalition will need to bring these things," Ofer Shelah, a senior member of the party, told press.

On Wednesday morning, Israeli media reported that with 99.8% of votes counted, the joint electoral list of Netanyahu's Likud party and the ultra-nationalist Yisrael Beitenu party of his former hard-liner Avigdor Lieberman had won 31 seats.

That would be 11 seats fewer than the two parties' combined total from the last election.

The ultra-nationalist Habayit Hayehudi "Jewish Home", which rejects the notion of an independent Palestinian state, won 11 seats, as did the ultra-Orthodox religious Shas party.

The smaller ultra-Orthodox United "Torah Judaism party" won seven, bringing the right-wing bloc's total to 60 of the 120 seats in the Knesset.

Yesh Atid (There is a Future), a secular centrist party which was only set up by Mr Lapid last year, had been expected by pollsters to win about 12 seats, but is set to get 19, just ahead of the Labour party with 15.

The centrist Hatnua (The Movement) grouping of hard-liner Tzipi Livni won six seats, as did the left-wing Meretz party. Kadima, which was the largest party in the last parliament, got just two.

Addressing Likud supporters after preliminary results gave the right-wing bloc a one-seat parliamentary majority, Netanyahu promised to form as "as broad a government as possible".

Labour party leader Shelly Yachimovich meanwhile said she had also initiated contacts aimed at forming a centre-left governing coalition.

A senior member of the Palestine Liberation Organisation (PLO) said the election result was unlikely to produce an Israeli government more committed to negotiating a permanent peace agreement.

"I don't see a peace coalition or a peace camp emerging now and revitalising itself," Hanan Ashrawi told reporters in Ramallah.