Israeli Prime Minister-designate Benjamin Netanyahu will pursue a policy of increased settlement expansion in the West Bank, his Likud party said on Wednesday, as he prepared to unveil his new cabinet.

Following his November 1 election win, veteran hawk Netanyahu secured a mandate to form a government backed by ultra-Orthodox Jewish parties and an extreme-right bloc.

The incoming government has sparked fears of a military escalation in the West Bank amid the worst violence in the Israeli-occupied Palestinian territory for nearly 20 years.

"The Jewish people have an exclusive and inalienable right to all parts of the Land of Israel," a statement of policy priorities released by his right-wing Likud party said.

"The government will encourage and develop settlement in all parts of the Land of Israel – in the Galilee, the Negev, the Golan, in Judea and Samaria," it added, using the biblical names for the West Bank.

The statement also referred to demands by Netanyahu's far-right allies to give security forces greater leeway in the use of force in the occupied West Bank.

"The government will strive to strengthen security forces and support fighters and police to combat and defeat terrorism," the statement said.

The statement came as Netanyahu unveiled the appointment of former general Yoav Galant as defence minister.

Galant, a member of Likud and a close Netanyahu ally, was given the key portfolio a day before the cabinet is expected to be sworn in before parliament.

A former commander of the southern region of Israel, Galant has also served in several ministerial posts in Netanyahu's previous cabinets.

Born in 1958 to Polish holocaust survivors, Galant had a long career in the army, reaching the rank of general in 2002, and becoming military attache to former prime minister Ariel Sharon.

He would later be appointed commander-in-chief of the southern military region, serving at the time of Israel's unilateral withdrawal from the Palestinian enclave of Gaza in the summer of 2005.

Bezalel Smotrich, leader of the extreme-right formation Religious Zionism, is to be the minister with control over civil affairs in the West Bank – a responsibility usually falling to the defence minister. (AFP)