Israel will purchase parts and components for its Iron Dome missile defense system from American contractors, returning more than half of the funds provided for it by the Pentagon to the US economy.
"Under this agreement, the United States focus shifts toward maximizing economic activity in the United States while ensuring that Israel’s security needs are met," an April 2 report by the US Missile Defense Agency to Congress, obtained by Bloomberg, said.
The US House Armed Services Committee approved an additional $175 million for Iron Dome, after Israel requested more money, bringing the total sum to $350.9 million in US-funding in 2015 for the missile defense system. Last week, the Senate Armed Services Committee also approved the aid package.
- US House approves $600 million military aid package for Israel
- Budget-strapped Israeli military banks on future US aid
- New deal to purchase V-22s relies on future US aid
"Given the significant US taxpayer investment in this system, the committee believes that co-production of parts and components should be done in a manner that will maximize US industry participation," a report by the House Armed Services Committee said.
The House committee conditioned the additional $175 million on the submission of "signed and ratified contracts, subcontracts and teaming arrangements" with US companies.
The Iron Dome missile defense system, developed by the Haifa-based Rafael Advanced Defense Systems, can intercept and destroy short-to-medium-range rockets and artillery shells fired from distances of 4-70 kilometers away.
According to the Israeli Air Force, the Iron Dome intercepted 421 rockets during the 2012 Operation Pillar of Defense, including rockets fired from the Gaza Strip towards Tel Aviv. The system, that only targets rockets heading towards populated areas, registered about 85 percent success rate during the Gaza operation.
Raytheon, the world's biggest missile maker and the fourth-largest US federal contractor, is contracted to find suitable American suppliers for the Iron Dome, in an agreement that "provides for significant United States co-production of Iron Dome components and interceptors in the United States," according to the Missile Defense Agency report.
The first contracts will be awarded by July, for production of parts for the missile defense system's Tamir interceptor, including the incoming rocket seeker and fuse, according to the report.