Israel's $119 Billion Bet on Self-Reliance: Building an Arms Industry Without Depending on Anyone

Stung by arms embargoes during the Gaza war including from its closest allies Israel is now investing over $100 billion to manufacture its own weapons and never be held hostage again.

The Announcement
Prime Minister Benjamin Netanyahu announced that Israel would spend 350 billion shekels approximately $110 billion on developing homegrown arms to reduce dependency on foreign countries. The announcement was made during a graduation ceremony for Israeli Air Force pilots.

"I approved, along with the defense minister and finance minister, a sum of NIS 350 billion over the next decade to build an independent Israeli munitions industry," Netanyahu declared.

"Our goal is to build an independent arms industry for the State of Israel and reduce the dependency on any party, including allies. The finest minds in our defence industries are hard at work developing weapons systems that will guarantee Israel's advantage on the battlefield of the future."

Why Now? The Arms Embargo Lesson
The motivation for this historic investment is rooted in hard lessons learned during the Gaza war.

During the war between Israel and Hamas, many countries imposed various restrictions on military sales to Israel. Those countries included friendly nations like Germany, the UK, and even the United States briefly under the Biden administration. Spain approved a total arms embargo on Israel, forbidding the export of any defence material or dual-use products to Israel.

The message was stark: even long-standing allies could become unreliable suppliers when political winds shifted. For a nation whose very survival depends on military readiness, that vulnerability was unacceptable.

Netanyahu said Israel would build an independent munitions industry over the next decade to "reduce dependence on all players," following the threat of arms embargoes and boycotts during the Gaza war.

The Scale of the Investment
In 2026, Israel is set to allocate about 16 percent of its public budget to defence around $35 billion out of an overall budget of $208 billion. The defence budget for 2026 has been set at NIS 112 billion, significantly less than what the military had initially sought but up from the NIS 90 billion that Finance Minister Bezalel Smotrich had originally proposed.

In 2026, Israel spent approximately $49.8 billion on military and defence, representing 8.0% of the country's GDP making Israel the 12th highest military spender in the world by absolute spending. Compared to 2025, defence spending increased by 4.8%.

Israel raised defence spending by NIS 42 billion ($12.5 billion) across 2025 and 2026 combined, with the budget agreement allowing the Defence Ministry to "advance urgent and essential procurement deals critical to national security."

The Five-Year Plan: "Hoshen" 2026–2030
The Israel Defence Forces has begun advancing a new five-year force-building plan called "Hoshen," guiding the military from 2026 through 2030. The plan emphasizes expanded use of advanced technologies including artificial intelligence, robotics, autonomous systems, and space-related capabilities, while addressing gaps in readiness exposed during more than two years of sustained conflict.

The Ministry of Defence has prioritized "munitions independence," accelerating domestic production lines for air-launched munitions and missile interceptors to reduce reliance on external supply chains and mitigate potential pauses in foreign aid. Israel's defence export order backlog has exceeded $80 billion in early 2026, with major export programmes including the supply of PULS rocket artillery to European partners and the sale of integrated air defence systems to nations in Asia and the Americas.

Key pillars of the Hoshen plan include:
Artificial Intelligence integrated into operational planning, command-and-control, and battlefield management

Robotics and Autonomous Systems deployed across air, sea, and ground forces
Space Capabilities to counter growing satellite programmes of rival states

Multi-layered Air Defence including further development of the Iron Beam laser-based air defence system

Munitions Independence domestic production of air-launched munitions and missile interceptors

What Israel Can and Cannot Yet Build Itself
While Israel relies on the United States for its fighter planes, refuellers, and helicopters, several local companies already build unmanned aerial platforms, including Elbit Systems and Israel Aerospace Industries (IAI).

Netanyahu acknowledged the limits of full independence: "I don't know if a country can be completely independent, but we will strive to ensure our arms are produced as much as possible in Israel, and that includes some aerial platforms."

The US Aid Question
Funding remains a key uncertainty. Negotiations with Washington over a successor to the current $38 billion military aid agreement which runs through 2028 are expected to significantly influence Israel's long-term defence planning. Potential reductions in US military assistance, early elections, or renewed conflict could complicate implementation of the ambitious plan.

As of April 2026, the Trump administration has notified Congress that it had approved at least $19.6 billion in foreign military sales and direct commercial sales of arms to Israel even as Israel simultaneously pursues self-sufficiency.

The Bigger Picture
Israel's drive toward defence self-sufficiency is more than a procurement decision it is a fundamental shift in strategic doctrine. A country that has survived seven decades of existential threat through a combination of military brilliance and American support is now signaling that it can no longer afford to depend entirely on either.

In a region where wars can ignite overnight and alliances can shift with a single election in Washington or Brussels, Israel is making a clear statement: the next time someone tries to cut off its weapons supply, Israel will already be making its own.

Mustapha Bature Sallama.
Medical/ Science Communicator,
Private Investigator, Criminal investigation and Intelligence Analysis.
International Conflict Management and Peace Building.USIP
mustysallama@gmail.com
+233-555-275-880

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