Israeli opposition parties on Wednesday announced that they have reached a coalition agreement to form a government that may bring an end to the record-breaking 12-year rule of Prime Minister Benjamin Netanyahu in Israel.

According to the official statement issued by Yesh Atid party, Yair Lapid, who was given a chance to form the government by President Reuven Rivlin after Netanyahu's right-wing Likud Party failed to cobble up numbers at the first attempt, informed Israeli President just 35 minutes before his Wednesday midnight deadline that he can form a government in which he and Yamina chief Naftali Bennett will switch off as prime minister.

“I commit to you, Mr. President, that this government will work to serve all the citizens of Israel, including those who aren’t members of it, will respect those who oppose it, and do everything in its power to unite all parts of Israeli society,” Lapid told President Reuven Rivlin.

The announcement of the new coalition will lead to an end of a political gridlock in Israel which has seen four elections in the last two years. If the coalition wins the confidence vote in the Knesset – the Israeli Parliament, it will bring down the curtain on Benjamin Netanyahu’s record 12-year-run as Israeli Prime Minister.

How does the new coalition look?

During the last set of elections in March, the centre-right alliance led by Netanyahu’s Likud party emerged as the largest group in the elections, winning more than 50 seats, but fell short of the 61-seat majority required to form a government.

However, Lapid’s Yesh Atid, the second-largest party in the 120-member Knesset - with 17 seats, has been able to form a coalition between eight political parties that are from a diverse array of ideologies: two from the left (Labor and Meretz), two from the center (Yesh Atid and Blue and White), three from the right (Yamina, New Hope and Yisrael Beytenu), and the conservative Islamic Raam. A look at their numbers:

Yesh Atid – 17

Blue and White – 8

Yisrael Beytenu - 7

Labor – 7

New Hope – 6

Meretz – 6

Yamina - 6

Raam - 4

The coalition has come into being after Lapid joined hands with Yamina Party chief Naftali Bennett and Raam’s Mansour Abbas. According to the deal between the anti-Netanyahu alliance, the new coalition government would be led until 2023 by Naftali Bennett, a hardline religious nationalist. Then from 2023 to 2025, the coalition would be led by Yair Lapid, a former TV presenter and secular centrist.

Who is Naftali Bennett?

Naftali Bennett, 49, is the son of American immigrants, and a former software entrepreneur, army commando. He heads the ultra-nationalist party Yamina, meaning Rightwards.

In the past, Bennett has worked for Netanyahu as a senior aide between 2006 and 2008. He left Netanyahu’s Likud party after his relationship with the Prime Minister soured. He is known to be a strong advocate of the Jewish nation-state and is openly against the two-state solution of the Israeli-Palestinian conflict. He has also taken a hard line towards Palestinian militants and has endorsed the death penalty for them.

Though his party won just seven seats in the Knesset, he has emerged as a real kingmaker, and probably now a king. The anti-Netayanhu alliance would not have come into force without his support. A high-tech millionaire, who has held several important government portfolios including the defence ministry in the past, set the terms of his involvement in the coalition by allowing him to be the next Prime Minister of Israel.

Why did an Arab party agree to this coalition?

United Arab List is a small Arab party known by its Hebrew Acronym Raam. Before its inception in 1996, it was affiliated with a branch of the Islamist movement that for years did not participate in Israel elections.

In the last three Israeli elections, the Joint List, which included Raam and a larger Arab political alliance, has emerged as the third-largest party in the party. In this year’s March elections, Raam had won four seats, becoming the largest single Arab party in the country. However, after its victory, the party separated from the Joint List and declared itself ready to join a government of any colour that promised political rewards to Arab citizens.

So, if the Lapid-Bennett coalition government becomes a reality, Raam would be the first independent Arab party in government and the first Arab party of any kind in a right-leaning government in Israel.

Even before the coalition came into being, the possibility of Raam playing a deciding role in the formation of a coalition government was making waves in Israel. For decades now, Arab parties have not been directly involved in Israeli governments. Only twice have Arab Israeli parties backed an Israeli government.

Mansour Abbas – the leader of Raam, has also emerged as another kingmaker in the Lapid-Bennett coalition pact. On Wednesday, when Mansour Abbas signed on to the coalition less than two hours before the deadline was set to expire, he becomes the first Arab Israeli party leader in half a century to sign a deal to sit in a coalition government.

“This is the first time that an Arab party is part of the process of forming a government. We of course hope that it works and that a government will rise after four rounds of elections,” The Times of Israel quoted Mansour Abbas as saying.

According to media reports, Raam has committed to the coalition deal after getting assurances for greater resources and rights for Israel’s Arab minority. Although, some of its demands including reforms to housing legislation are deemed as unacceptable to some of the coalition’s hard-right members.

What will the agenda of the coalition?

The coalition consists of ideologically opposed parties that are from the left to the far right. However, the coalition partners have decided to focus on largely technocratic issues like the economic recovery from the COVID-19 pandemic and infrastructure, and to stay away from more contentious topics such as trying to resolve the Israeli-Palestinian conflict.

Some analysts feel that the glue of the coalition agreement is their common motive to oust the Netanyahu from post of Prime Minister, and eventually, coalition partners will have to dive into contentious topics to keep their supporters base happy.

Is it the end of Netanyahu?

There is still some time for the new coalition government to be sworn in. Netanyahu, who remains caretaker Prime Minister, could use this time to give his last shot at breaking away the coalition agreement. His party has already promised to put pressure on right-wing members of their coalition alliance to upend the agreement by telling them they have betrayed their ideology by aligning themselves with leftist and Arab lawmakers.

If he fails to persuade his opponents, it will the end of Netanyahu, at least for now, at being at the helm for 12 years. As his party hold significant seats in the Knesset, the 71-year-old Israel's longest-serving leader will be a natural opposition leader.