Republic is setting up a king (6)
I believe the answer is:
israel
'republic' is the definition.
(I've seen this before)
'is setting up a king' is the wordplay.
'setting up' shows that the letters should be reversed in order.
'a king' becomes 'lear' (King Lear).
'lear' in reverse letter order is 'rael'.
'is'+'rael'='ISRAEL'
(Other definitions for israel that I've seen before include "Mediterranean republic" , "Middle-Eastern state" , "Middle-Eastern country" , "Country of E. Med" , "Hands perhaps" .)