President Thomas Klestil appeared set Wednesday to give the far right a share of national power, despite threatened diplomatic sanctions by the United States and European governments.
Klestil told an Austrian magazine that as much as he might prefer to keep Joerg Haider's Freedom Party out of the Cabinet, he cannot ignore October's national election results.
"If I were to swear in this government, I would not do it out of personal conviction, because I fear that Austria would suffer internationally," he said in an interview to be published in today's editions of the magazine News.
But he added: "In a democracy, a parliamentary majority has to be respected."
Haider, who has said he will remain governor of Austria's Carinthia province rather than take a Cabinet post, led his Freedom Party to second place in the elections.
No party won an outright majority, and Haider built his appeal on public cynicism as the ruling coalition of Social Democrats and the conservative Austrian People's Party tried desperately to hold onto power. If an election were called today, Haider's party might take first place with 33 percent, according to a poll this week.
Klestil met Wednesday with Haider and Wolfgang Schuessel, head of the People's Party, to hear their proposed coalition government's program. After the meeting, Haider said Klestil liked what he heard but asked for some amendments.
Klestil's office reportedly said later that Schuessel and Haider would sign a "declaration of values of European democracy" today. The new government was expected to be approved after the signing.
The signing of such a declaration seemed aimed at heading off international criticism, including from Austria's partners in the European Union and the United States. Within Austria, about 10,000 people rallied Wednesday night in front of the People's Party headquarters in Vienna to protest its deal with Haider.
Schuessel, who is Austria's foreign minister, is expected to lead the new government as chancellor. Haider said Wednesday that one of his party members will become finance minister.
Schuessel's party is expected to control the Foreign, Economics, Agriculture and Education ministries, and perhaps most significant, the Interior Ministry, which controls immigration policy.
By keeping that out of the Freedom Party's direct control, Schuessel may allay some fears that Austria will impose severe restrictions on immigration. Last weekend, Haider claimed the coalition would effectively freeze immigration, except for migrant workers allowed in during peak tourist season.
The Freedom Party hopes to take charge of the Defense and Justice ministries, as well as social affairs and a new ministry responsible for infrastructure.
Foreign criticism of Austria continued Wednesday.
Israel said it would recall its ambassador to Vienna if Haider's party joins the Austrian government. Israeli Prime Minister Ehud Barak, in announcing contacts with European leaders to coordinate possible sanctions, called on the "entire free world" to oppose Haider's rise to power.
"We cannot accept, at the beginning of the 21st century, a government that would include a man with Haider's almost neo-Nazi positions," Barak said. "This is an extreme right that's very dangerous for democracy in Europe. Only a strong popular reaction can make this clear to Austria."
In Germany, politicians and Jewish community leaders expressed alarm at the prospect of Haider and his party occupying any place in power in a country that has yet to fully come to grips with its relationship with Nazi Germany.
"Haider's strategy is clear _ he wants to be chancellor," German Foreign Minister Joschka Fischer said in Berlin, worrying aloud that the Austrian far-right leader's rise could galvanize extremists throughout Europe.
German officials have vowed support for political sanctions against Austria, even though it is a neighbor and fellow European Union member. Chancellor Gerhard Schroeder's chief foreign policy adviser, Michael Steiner, said no Austrian government official would be welcome in the other 14 capitals of the EU.