Fifa has stripped Indonesia of hosting rights for the Under-20 World Cup.
The decision follows the cancellation of the official draw for the tournament, which was due to be held in Bali last Friday.
The Football Association of Indonesia said Fifa was forced to cancel the draw after Bali's governor Wayan Koster refused to host the Israeli team.
The U20 World Cup is set to take place from 20 May to 11 June.
Indonesia does not have any formal diplomatic ties with Israel and recently protesters have held marches demanding Israel be stopped from competing in the tournament, in support of Palestine.
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