Israel thrust between far-right support and Gaza cease-fire, as Netanyahu rival quits war cabinet

• Israel's war cabinet minister Benny Gantz resigned from the emergency government,.
• He withdrew his party from the coalition after Netanyahu missed a June 8 deadline to present a concrete plan for the Gaza enclave's post-war governance.
• "Regrettably, Netanyahu is preventing us from advancing toward true victory, which is the justification for the ongoing and painful cost (for war). That is why we are leaving the emergency government today, with a heavy heart but with full confidence," Gantz said, according to Reuters-translated video footage.

Israel's war cabinet minister Benny Gantz resigned from the emergency government, dealing a decisive blow which is expected to entrench Prime Minister Benjamin Netanyahu deeper into a far-right support base that opposes a cease-fire in Gaza.

A former chief of staff of the Israeli Defense Forces, centrist Gantz co-founded and led the National Unity party that joined Netanyahu's emergency government after the outbreak of the Gaza war. He withdrew his party from the coalition after Netanyahu missed a June 8 deadline to present a concrete plan for the Gaza enclave's post-war governance.

Netanyahu has previously floated "day-after" provisions for the Gaza Strip that included Israel's "responsibility of overall security" of the territory and a stalwart rejection of splintering it into a separate Palestinian state.

Gantz announced his resignation on Sunday, just as Netanyahu celebrated the rare rescue of four hostages taken captive during the Oct. 7 terror attack perpetrated by Palestinian militant group Hamas, which triggered Israel's retaliatory Gaza campaign.

"Regrettably, Netanyahu is preventing us from advancing toward true victory, which is the justification for the ongoing and painful cost (for war). That is why we are leaving the emergency government today, with a heavy heart but with full confidence," Gantz said, according to Reuters-translated video footage.

"I was very privileged, together with my friends, to bring to the cabinet room all the experience we had. I know other people are staying there. Mainly, you have [Defense Minister Yoav] Gallant. And the prime minister himself. They know what should be done. Hopefully, they will stick to what should be done – then it will be OK," Gantz added.

On Saturday, Netanyahu had taken to social media to entreat Gantz to remain in the emergency government, stressing "this is the time for unity and not for division," according to a Google translation.

Current opposition leader Yair Lapid welcomed the decision of Gantz and of his ally Gadi Eisenkot to leave the emergency government as "important and right."

"The time has come to replace this extreme and promiscuous government with a sane government that will lead to the return of security to the citizens of Israel, to the return of the abducted, to the restoration of Israel's economy and international status," Lapid said in a Google-translated social media post.

Gantz's withdrawal comes at a tenuous time for Netanyahu's government, which faces rising domestic discontent over the war management and efforts to retrieve the dozens of hostages that are believed to remain in captivity in the Gaza Strip. Israel has also drawn international criticism over the proportionality of its military response and the risk to Palestinian civilians — including an order from the U.N.'s top court to halt the war campaign in Rafah and an application from an International Criminal Court prosecutor seeking arrest warrants against Netanyahu, Gallant, and three Hamas leaders over accusations linked to the Gaza conflict.

Around 1,200 people were killed in Israel, Israeli official figures say, since the start of the Gaza conflict. The death toll in the enclave has crossed 37,000 over that period, according to Gaza's Ministry of Health.

Gantz's seismic departure will rattle, but not uproot the administration of Netanyahu. Eran Etzion, former deputy head of Israel's National Security Council, told CNBC on Monday that the Israeli prime minister can reposition back in his coalition of far-right support and ultra-Orthodox parties.

"To cling to power, Netanyahu will continue to maneuver between his base, and US demands. The pro democracy movement will also increase its pressure in the streets. And the highly unpopular 'draft law,' effectively granting all Ultra Orthodox men full exemption from military service, is also expected to increase the de legitimization of the government," Etzion said.

Nimrod Goren, senior fellow at the Middle East Institute, meanwhile stressed to CNBC that Netanyahu is unlikely to go against his far-right coalition partners at this juncture, weakening the odds that Israel will ultimately endorse a cease-fire proposal in the Gaza Strip, such as the three-phase plan aired publicly by the U.S. last month.  

"Gantz's resignation lowers the chances that Netanyahu will agree to a deal necessitating a significant halt of IDF operations in Gaza and the release of a large number of Palestinian prisoners," Goren said.

Far-right politicians have already lashed out against the framework, with Itamar Ben-Gvir, national security minister and leader of the far-right Jewish Power Party, qualifying it as "a promiscuous deal, which is a victory for terrorism and a security danger to the State of Israel" in a Google-translated social media post. He further threatened to dissolve the government, if the proposal is implemented.

Bezalel Smotrich, finance minister and head of the Religious Zionist Party, likewise said that he would "not be part of a government that will agree to the proposed outline and end the war without destroying Hamas and returning all the abductees," according to a Google-translated social media update.

But Etzion said that Gantz's departure will not tip the scales on the cease-fire proposal.

"Gantz's position on the deal was effectively identical to Netanyahu's," he said, noting that Gantz and Lapid have assured they will support the proposition from their ranks. "The deal was and is up to Netanyahu to decide. He can garner a majority to whichever decision he wants to make. This was true when Gantz was in, and it's true when he is out."

CNBC has reached out for comment to the Israeli Prime Minister's Office.

— CNBC's Dalya Al Masri contributed to this report.