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SHAMIR FORMS COALITION - AT LAST

Prime Minister Yitzhak Shamir announced Friday he has formed a coalition government, the first Cabinet to be fully controlled by Shamir's right-wing Likud bloc since 1984.

If the new government wins approval in the Knesset it would end a 3-month-old political deadlock, during which Labor Party leader Shimon Peres and then Shamir tried to form a government.Shamir's announcement came after he signed an agreement with a string of far-right and religious factions, plus a defector from the rival Labor Party. Friday's agreement would give Shamir 62 votes in the 120-member Knesset, or parliament, Israel army radio said.

Close election results since 1984 had forced Likud and the left-center Labor into power-sharing arrangements, but ideological differences often stymied political action.

A Likud-Labor government fell apart March 15 in disagreement over whether to take part in U.S.-proposed peace talks with Palestinians.

Israel radio said policy guidelines accompanying the new coalition agreement say there will be continuity with decisions of the past government.

This apparently means Israel will keep open its initiative to hold elections for Palestinians in the occupied territories as a first step toward ending the Israeli-Arab conflict.

However, the far-right members of the new government will probably lead Shamir into more tensions with the United States, which has been urging Israel to make concessions to Palestinians.