Israel and Germany Advance Arrow 3 Defense System Deal

German Defense Minister Boris Pistorius and Defense Minister Yoav Gallant greet each other at the end of a joint press conference in Berlin, Germany, Thursday. (REUTERS/Fabrizio Bensch)

Israel and Germany on Thursday took a significant step forward in their defense partnership, signing a letter of commitment to proceed with delivering the Arrow 3 air defense system to Germany. The deal, signed by representatives of both Defense Ministries, unlocks €560 million in funds approved by the German Parliament earlier this year. This funding will enable Israel to initiate production of the three Arrow 3 batteries slated for delivery to Germany by 2030.

While the exact number of batteries remains unconfirmed, the agreement represents a milestone in defense cooperation between the two nations.

Defense Minister Yoav Gallant lauded the signed agreement as a “major achievement for the defense industry.” Gallant and his German counterpart Boris Pistorius, present at the signing ceremony in Berlin, also reinforced their countries’ commitment to defense collaboration. The comprehensive deal is expected to reach nearly €4 billion, constituting Israel’s largest-ever single defense contract.

A separate contract will be finalized to conclude the Arrow deal, contingent on approval by the German Parliament, which is expected in October. The Arrow 3 system, developed to intercept space-borne threats like ballistic missiles, warheads, and satellites, received approval from the United States in August. It is anticipated to play a role in the European Sky Shield Initiative, led by Germany, aimed at bolstering continental Europe’s air defenses in response to Russian military actions in Ukraine.

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