There are a number of conflicting versions of this story circulating. But so far it would seem that there is a major halachic problem - not racisim. Furthermore these are Falash Mura who had converted to Christianity in Ethiopia, not the Beta Yisroel See also Tzitz Eliezer
JPost is reporting that Rav Ovadiya Yosef is demanding that the students be accepted.
Shas spiritual mentor Rabbi Ovadia Yosef threatened Monday to fire any school principal from Shas's school system who refused to receive Ethiopian students.
In parallel, Chief Sephardi Rabbi Shlomo Amar announced that it was forbidden to send Ethiopian students to the secular school system.
"If I was brought into this world only to help the Ethiopians that is enough for me", said Yosef on Monday morning during a meeting with Amar in his home in Jerusalem's Har Nof neighborhood, according to Amar's spokesman.
Amar's spokesman said that the chief rabbi ruled that it was forbidden to integrate the Ethiopians in secular state schools because many were Falashmura who were still in the process of converting to Judaism. [...]
Haaretz reports That Chief Rabbi Amar - says that they can't be accepted because of unnamed halachic reasons
Sephardi Chief Rabbi Shlomo Amar said Monday that Ethiopian students could not be accepted into religious schools in Petah Tikva because of "halakhic reasons." [...]