SYDNEY, Oct 20 - The Australian government is poised to lose its one-seat majority in parliament with almost half the votes counted in a crucial by-election late on Saturday, threatening the ability of the centre-right coalition to govern.The by-election for the wealthy seaside constituency of Wentworth, in Sydney's east, was sparked by the resignation of former prime minister Malcolm Turnbull, who was ousted in August by his own party after in-fighting among Liberal lawmakers.With 46 percent of votes counted, locals registered a 22 percent swing against the government's candidate, according to official electoral results. That is more than enough to hand the seat to prominent independent candidate Kerryn Phelps."This win tonight should signal a return of decency, integrity and humanity to the Australian government," Phelps told her supporters in Sydney.Prime Minister Scott Morrison acknowledged the likely defeat on Saturday, while pledging to fight all the way until the next election."We will stand up for what we believe until the bell rings, and the bell hasn't rung, Liberals, the bell hasn't rung," Morrison told supporters.Morrison will now be left relying on the support of independent lawmakers to continue to govern in the tightly contested parliament.The next election is not due until May 2019, although it could occur earlier if the Liberal-led coalition can't win the support of at least one independent MP and continue to govern.Two independents have already ruled out supporting the government, and others have warned Morrison that he will have to pay a hefty price for their backing.The by-election where 13 percent of voters are Jewish drew international attention after Morrison proposed Australia could follow U.S. President Donald Trump's controversial decision last December by recognising Jerusalem as Israel's capital and moving its embassy there.Arab diplomats expressed their worries to Canberra this week, and neighbouring Indonesia, the country with the biggest Muslim population, warned that Australia was risking its trade and business relationship with the entire Islamic world.Dave Sharma, the Liberal candidate in Wentworth, is a former Australian ambassador to Israel who is credited with first making the proposal to relocate the embassy from Tel Aviv to Jerusalem.The status of Jerusalem is one of the thorniest obstacles to a peace deal between Israel and the Palestinians. Israel regards all of the city, including the eastern sector that it annexed after the 1967 Middle East war, as its capital.The Jerusalem proposal was the most controversial element of an already heated campaign. Turnbull's own son called on voters to shun the Liberal Party, while Sharma was scolded for using an unauthorised endorsement from a prominent rabbi.Less than 0.5 percent of Australia's population is Jewish, while Muslims account for over 2 percent.