The 2023 World Beach Games, scheduled to take place in Bali next month, have been canceled after hosts Indonesia suddenly withdrew from the tournament.
It comes three months after football's world governing body FIFA stripped Indonesia of its right to host the Under-20 Men's World Cup on the tourist island after it objected to the participation of Israel.
About 1,500 athletes from 100 countries were set to compete in Bali from August 5 to 15 in the youth-focused tournament featuring sports including beach soccer, surfing, sailing and beach volleyball.
The organizer, the Association of National Olympic Committees (ANOC), said Indonesia had pulled out of hosting duties due to budget constraints and there was not enough time to find a replacement host nation.
"It is with great surprise and extreme disappointment that ANOC has learnt that the Indonesian Olympic Committee (KOI) has withdrawn from its commitment to host the ANOC World Beach Games and the ANOC General Assembly in August 2023," ANOC said in a statement Tuesday.
"The KOI stated the decision was taken after the budget was not released by the government of the country and there is now not time to deliver the games."
ANOC cited no political reason for Indonesia's withdrawal in its statement but it follows reported comments from Bali Governor Wayan Koster rejecting Israel's presence in Bali ahead of the games, according to CNN affiliate CNN Indonesia. CNN has reached out to the Bali governor for comment but has not received a response.
Indonesia, a Muslim majority nation of more than 270 million people, does not have formal diplomatic relations with Israel and supports the cause of the Palestinians.
Anti-Israeli sentiment runs high among conservative Muslims in Indonesia. In March, protesters marched in the capital Jakarta demanding the government ban Israel from playing in the Under-20 Men's World Cup.
In the run up to that tournament, which was also scheduled to be held in Bali, Koster had sent a letter to Indonesia's sports ministry requesting Israel be banned from competing in the province and said the provincial government of Bali refused to allow the Israeli team to compete on the island, officials at the Football Association of Indonesia told CNN at the time. Shortly after, FIFA stripped Indonesia of hosting the international event.
CNN reached out to the Bali governor at the time for comment but did not receive a response.
Indonesia's withdrawal from the World Beach Games at such a late hour caught the organizing body off guard.
"ANOC and the KOI met for weekly coordination meetings, as recently as last week, and at no point did the KOI indicate there were any issues that would lead to such an outcome," ANOC said in its statement.
On Wednesday, Indonesia's sports minister Dito Ariotedjo said the government had allotted 446 billion rupiah (about US$29 million) for the games but it was still under review, according to Reuters and Indonesia's Antara news agency.
In a statement, Indonesia National Olympic Committee spokesperson Raja Sapta Oktohari said the decision to cancel was made with a "heavy heart," citing a bureaucratic hold up with the budget and not enough time to smooth it out.
"The situation is felt to be getting more difficult because several sponsors of the 2nd ANOC World Beach Games Bali 2023 have also announced their withdrawal," Raja Sapta said.
CNN has reached out to ANOC and the KOI for further comment on Indonesia's withdrawal from the tournament.