It is well known that Israel is nestled in a difficult neighbourhood and has been in a state of war for many decades now. It is therefore not surprising that the country has given high priority to defence preparedness. Consequently its military spending has been on the higher side. For instance, the projected defense budget for 2025 has witnessed an 80 percent increase compared with the 2022 and is pegged at US $30.5 billion. This high increase is attributable to its sharpened focus on the defeat of militant group Hamas, Hezbollah and the Houthis with whom it has been at war since 07 October 2023 when Hamas soldiers breeched the Gaza border into Israel and killed nearly 1,200 people and kidnapped over 200 more, many of them civilians.

The Israeli defence industrial complex is well known for high-end military hardware, and the effectiveness of Israeli weapons and sensors has been demonstrated in real time in many wars. There are over two dozen Israeli defence and space industries which produce a variety of weapons, sensors, equipment, and ammunitions. It is reported that Israel’s annual foreign sales (2017 and 2022) vary between US $7 to US $12.5 billion. 

Among the Israeli military conglomerates, the Israel Aerospace Industries (IAI) performance is notable. It recorded net profit of US $493 million for 2024, which corresponds to a 55% increase compared to the previous year. In terms of the geographical spread of sales, Asia was at the top and IAI’s 36.2% of total sales, up from 29% in 2023. In Asia, India, Vietnam and the Philippines out as important customers of the Israeli military related hardware.

Israeli’s military equipment have found favour in India due to convergence of political and strategic interests and the Israeli equipment has proven efficient; besides, Israel is a trustworthy supplier accounting for nearly 37 per cent of its total arms exports to India. According to an Indian expert, “India’s arms trade with Israel began as a simple supplier-recipient relationship, but today it has evolved into co-development and co-production of military technology,’.

The Indian companies engaged with the Israeli defence industries include TATA, Bharat Forge, Tech Mahindra, startup Tonbo Imaging is providing systems for precision-guided bombs, and Hindustan Aeronautics Limited is into midair refueling.

Israel is also looking towards Vietnam to sell military hardware. Vietnam acquired nearly US $2 billion worth of Israeli-made defense systems such as air defense systems, reconnaissance drones, and advanced radar networks. It has been noted that Israeli weaponry is “reinforcing Vietnam’s military muscle”. The high end weaponry include the  Python air-to-air missiles and Derby air-to-surface missiles, and Skylark drones for reconnaissance missions, EL/M-2085 radar target detection, and Barak-8 air defense systems for airborne threats.

Furthermore, according to reports, Vietnam has contracted for “two state-of-the-art surveillance satellites, valued at a staggering US$680 million (RM2.9 billion), which will serve as its “eyes and ears”. These “ optical imagery photography satellite and a synthetic-aperture radar satellite” are capable of providing “picture of the ground even at night or through complete cloud cover” particularly over South China Sea which is claimed by China. The IAI is in the forefront and a joint venture with a Vietnamese company in 2025 could include technology transfers for the development of a variety of military equipment.

Likewise, Israel is the second-largest arms supplier to the Philippines (nearly 12 per cent of Israel’s arms exports) valued at over US $4.2 million in 2024. According to a Philippines defence analyst “Manila sources a lot of its military equipment from Israel, everything from rifles and missiles to armoured vehicles, drones, planes, and smaller attack craft,” In 2024, the Philippines Navy acquired two Acero-class patrol gunboats fitted with advanced missile systems.

The Philippines military hardware requirements are fast increasing due to aggressive posturing by China in the South China Sea. The IAI is reported to have been in discussions with the government to supply coastal and aerial defence systems. It has also offered the Barak MX integrated air and missile defence system which has acquired the reputation of being the “most advanced aerial defence systems currently in operation”.

Israeli defence companies continuously debut new products tailored for the evolving warfare which involves both traditional hardware and autonomous and smart platforms. It is fair to argue that Israel has built a robust military industrial complex and is capable of supplying sophisticated hardware to both its armed forces and other countries. Although Islamic countries in Asia can be expected to boycott Israeli military equipment, Australia, Japan and South Korea are good customers for future joint development.

Dr. Vijay Sakhuja is Professor and Head, Center of Excellence for Geopolitics and International Studies (CEGIS), REVA University, Bengaluru and is associated with Kalinga International Foundation, New Delhi.