Speaking at the UN on Tuesday, Mr. Lieberman – who leads the second-largest party in Netanyahu's coalition government – said a peace deal could take decades.
He also proposed a land swap in which predominantly Arab areas inside Israel could be incorporated into a future Palestinian state in exchange for the Israeli settlement blocs in the West Bank – a proposal sharply at odds with Netanyahu's stated approach. The proposal received a predictably outraged response from Palestinian leaders.
Lack of unity on both sides is a key theme that makes it hard to see fast progress for Netanyahu and Palestinian Authority President Mahmoud Abbas. The Palestinian's internal divide, with Hamas controlling Gaza and opposed to the current talks, is mirrored by Israel's own.
Hawks like Lieberman who argue the Palestinians are uninterested in peace, are arrayed against both the country's more conciliatory peace camp and Netanyahu, caught between US pressure and his coalition partners.
Lieberman spoke of the "utter lack of confidence between the sides and issues such as Jerusalem, recognition of Israel as the nation-state of the Jewish people and refugees" and said "under these conditions, we should focus on coming up with a long-term intermediate agreement, something that could take a few decades.”