Indian Sales Push Israeli Defense Export to All-time High of $9.2 Billion

Sales of the Barak missile system and other weapons deals with India have pushed Israeli defence exports to an all-time high of $9.2 billion in 2017.

Israel’s defense exports increased by 40 percent since 2016 with more sales to Asia Pacific region, according to figures published by SIBAT - The Foreign Defense Assistance and Defense Export Organization Wednesday.

According to Stockholm International Peace Research Institute's (SIPRI) report on arms transfer for 2017, India’s arms imports from Israel also increased (by 285 per cent) between 2008–12 and 2013–17, making Israel the third largest supplier to India. India accounted for nearly a third of Israel’s arms exports in 2017.

The defense related transactions totalled $6.5 billion, SIBAT report stated. 31 percent of the total defense exports are attributed to sales of missiles and aerial defense followed by 17 percent of Radar systems and electronic warfare. In February 2017, the Indian cabinet committee on security had approved the procurement of 40 units of the Barak-8 MR-SAM system worth about US$2.5 billion.

In addition, IAI had said in May 2017, it has won an additional $630 million contract to supply the Barak-8 LR-SAM for four ships of the Indian navy.

 “The Barak-8 became a cash cow for IAI over the past year, following a string of huge deals with the Indian defense establishment with an aggregate total of $2.6 billion. The (defence) deal is the largest in IAI's history and the history of Israel, and is already reflected in IAI's results for the first half of the year,” IAI Chief Executive Officer (CEO), Joseph Weiss had said in an interview with Israeli business newspaper, Globes in October last year.

Israel would have gained an additional $500 million had India not cancelled Spike anti-tank guided missiles contract with Rafael.

Both IAI and Rafael gained from the removal of blacklisting and closing of investigations in 2017 by the current government. IAI and Rafael fell under suspicion in the Barak missiles deal with the Indian Navy in 2006 but the cases were closed in 2013 due to lack of evidence in the bribery case. The order for the closer only came in 2017.

Most of the defense exports were from IAI, Rafael, IMI Systems, and Elbit Systems Ltd, SIBAT report stated.