Israel's new government gave the green light Monday for a controversial march by Jewish nationalists through annexed east Jerusalem, despite concerns over renewed tensions with the Palestinians.

Authorising the march set for Tuesday, Internal Security Minister Omer Bar-Lev's office said: "The police is ready and we will do everything in our power to preserve the delicate thread of coexistence."

The march was originally due to take place last Thursday but was delayed due to Israeli police opposition to the route and warnings from the Palestinian Islamist group Hamas.

The outgoing government put off the march until Tuesday.

"The right to demonstrate is a right in all democracies," said Bar-Lev, part of the new administration which took office after a vote in parliament on Sunday.

The so-called "March of the Flags" represents an early test for the new government.

Rallies by far-right Jewish groups last month raised tensions in flashpoint areas of Jerusalem, prompting a police intervention in Al-Aqsa mosque compound.

That triggered rocket attacks by Hamas and Israeli air strikes on Gaza.

The 11-day conflict killed 260 Palestinians including some fighters, the Gaza authorities said. 

In Israel, 13 people were killed, including a soldier, by rockets fired from Gaza, the Israeli police and army said.