Resignation of hardliners leaves Israel coalition in disarray

Avigdor Lieberman, the leader of the most right-wing party in Israel's coalition government, yesterday resigned in protest at the decision to hold talks with Palestinian leaders on the "core issues" in the conflict.

Mr Lieberman fulfilled his promise to pull the 11 Knesset members of his party, Yisrael Beiteinu, out of Ehud Olmert's coalition if Israel were to begin talks with the West Bank-based emergency Palestinian Authority on borders, refugees and the future status of Jerusalem, which it did on Monday.

The move came amid continued violence in Gaza during which a 13-year-old Palestinian boy, his father and his uncle were killed in an air strike that the Israeli military said had "unintentionally" had hit their vehicle.

The Moldovan-born leader, whose main base is among the million immigrants from the former Soviet Union, and who has frequently been accused of anti-Arab racism by his critics, said that he was against the concept of "land for peace". He added: "If we pull back to the 1967 borders, everyone should ask himself, what will happen the following day? Will the terror stop? Nothing will change."

Mr Olmert, the Prime Minister, has in fact made it clear that he is seeking a deal significantly modifying the 1967 borders, under which the largest West Bank settlements will remain in Israel. Mr Lieberman's move will reduce Mr Olmert's majority from 18 to a more fragile one of seven in the 120-seat Knesset, and may put pressure on the religious party Shas to follow suit. Shas has said that it will leave the government if the division of Jerusalem – a bedrock requirement of the Palestinian President, Mahmoud Abbas – is on the table.

The most ardent peace campaigners would prefer a centre-left coalition augmented by bringing in Meretz. But Mr Olmert, the leader of the Kadima party, has reportedly been courting another religious party, United Torah Judaism, in an effort to shore up his right flank and give Shas better cover for remaining in the coalition.

The Lieberman departure, while widely welcomed on the left, also complicates Mr Olmert's task in surviving publication of the final – and potentially highly critical – Winograd report on his handling of the Lebanon war in 2006, expected on 30 January.

The Israel Defence Forces said yesterday they were opening an investigation into the air strike that destroyed the Yazagi family's pick-up, which came the day after 19 Palestinians – mostly militants – were killed in operations against the launch of Qassam rockets and mortars into Israel.

The military said that it had been targeting a Palestinian rocket-launching team and the militant Popular Resistance committees told Associated Press that the attack appeared to have been aimed at its chief rocket maker, who was driving in the area at the time. Instead the strike killed Amir Yazagi, his father, Mohammed, and his uncle Amr.

Meanwhile, Gaza militants launched 29 Qassam rockets in the wake of Tuesday's deaths in Gaza and the killing of a top Islamic Jihad commander by Israeli forces yesterday in a pre-dawn raid on the village of Qabatiya south of Jenin, in the West Bank.

Meanwhile, it emerged yesterday that EU members states, including Britain, are stepping up pressure on Israel to ease humanitarian suffering in Gaza and abate the collapse of Gaza's economy by reopening the Karni cargo crossing, which has been closed since June. "It is simply not acceptable in humanitarian terms," said a senior Western diplomat. The diplomat welcomed the recent calls by Salam Fayyad, the Ramallah-based Palestinian Prime Minister for the crossing to be opened.

Major Avital Leibovich, an IDF spokesman, said that civilians were regrettably hurt when militants operated in civilian environments. "It is important to me to stress that we have no intention whatsoever to hit or hurt uninvolved civilians," she said. The military says the air force has reduced the proportion of civilians killed in an air strike from 50 per cent in 2002-03 to 2-3 per cent in 2007.