TEL AVIV—Israel’s top court ruled that Prime Minister Benjamin Netanyahu can form a government while under indictment, removing a final hurdle in the incumbent’s bid to remain in power as he goes on trial later this month on corruption charges.

The High Court this week reviewed eight separate petitions challenging a deal between Mr. Netanyahu and rival Benny Gantz to form a unity government after three inconclusive elections in a year. The two politicians said the coronavirus pandemic necessitated an end to continued political…

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