Former deputy prime minister Tzipi Livni is planning a return to the political arena at the head of a new centrist party, challenging Prime Minister Benjamin Netanyahu and her former party, Kadima, in the upcoming elections.

Ms Livni, who served as foreign minister in the last Kadima government before leading the party in the 2009 elections, resigned from the Knesset earlier this year after losing the party’s leadership primary to Shaul Mofaz.

Despite her resignation, she has remained politically active behind the scenes and has held talks with the leaders of other centrist parties. Sources close to her said this week that she would not be joining any of the existing parties but intended instead to lead a new party of her own which would focus mainly on the need to renew the diplomatic process with the Palestinian Authority.

The only scenario in which Ms Livni may be prepared to take a deputy-leadership role would be if former Prime Minister Ehud Olmert makes a comeback to politics. Olmert is eager to return but, since he still fighting corruption charges in court, such a development is improbable.