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Israeli Prime Minister Benjamin Netanyahu and opposition leader Benny Gantz have agreed to form an emergency unity government and a war cabinet alongside Defence Minister Yoav Gallant.
The new government will have a war cabinet that will include Mr Netanyahu, Mr Gantz and Mr Gallant, officials said.
They will be joined by former Israeli army chief of staff Gadi Eizencot, a member of Mr Gantz's party, and current Minister of Strategic Affairs Ron Dermer.
Two other top officials will serve alongside the five-member war cabinet as “observer” members.
The new unity government will not pass any legislation or decisions that are not connected to the war as long as the fighting continues, the officials said.
Former Prime Minister Yair Lapid, another opposition leader, will have the option to join this new war cabinet that will be focused entirely on Israel's military efforts, a source from the Israeli government told The National.
It was not immediately clear what would happen to Netanyahu’s existing government partners, a collection of far-right and ultra-Orthodox parties.
Both Mr Netanyahu and Mr Gantz also decided following their Wednesday meeting no judicial overhaul legislation will be discussed in the Knesset as long as the war goes on.
It comes hours after Mr Netanyahu's Likud party said the existing government coalition approved an expanded cabinet to include members of the opposition.
“I can tell you that the national unity government certainly reflects what you see among the Israeli public right now,” a spokeswoman for Mr Netanyahu’s office told The National.
Calls for unity have grown as the war with Hamas enters its fifth day, after killing more than 1,200 Israelis and 1,000 Palestinians in the Gaza Strip which is now under a total Israeli blockade.
Mr Gantz, a former Israeli army chief of staff and defence minister, had said he would agree to a unity government with a smaller war cabinet that included members of his party as long as far-right members of the current coalition, including National Security Minister Itamar Ben-Gvir and Finance Minister Bezalel Smotrich, were excluded.
He has hit out at Mr Netanyahu and government ministers over settler attacks in the occupied West Bank and support of Israeli attacks on Palestinian communities, saying they also endanger Israeli troops and civilians.
The meeting between Mr Gantz and Mr Netanyahu, initially scheduled for Tuesday, had been delayed during arguments over the role of several far-right ministers in Mr Netanyahu's cabinet, who have been blamed for exacerbating tensions in the occupied West Bank over the past several months.
On the streets of Jerusalem many Israelis reacted with relief that the country's disparate political parties finally managed to form a unity government.
“I think it's a good sign,” said Israel Chi.
Mr Chi, who normally votes for Mr Netanyahu’s Likud Party called on Israel’s politicians to “avenge” those killed and kidnapped.
“I am happy because now all the world will feel and see that all of Israel is together,” said Matan Arian, 32, who owns a grocery store near the Old City.
Mr Arian said he was originally supposed to be at the music festival where so much of the carnage and devastation took place but at the last minute cancelled because his girlfriend wasn’t feeling well.
“I’ve been stressed,” he told The National. “I am a lucky man.”