Sunday's shelling exchange was the fiercest between Israel and Hezbollah since the end of the 2006 Second Lebanon War. While neither side is keen to see an escalation, Israel has said it could act against any upgrades of Hezbollah's missile arsenal, while Hezbollah has said it would retaliate for any attacks on Lebanese soil.
In a statement to media accompanied by satellite images, the Israeli military said that Hezbollah, with Iranian assistance, had been bringing specialised equipment to a weapons factory near the Bekaa village of al-Nabi Sheet with a view to setting up a production line for precision-guidance missiles.
Prime Minister Benjamin Netanyahu said in response that Israel’s enemies will not possess precision-guided missiles on his watch. “These precision missiles are aimed directly at (the northern city of) Kiryat Ata,” said the prime minister.
Hezbollah recently moved some of the equipment to "civilian locations" in Beirut as a precaution against strikes, the Israel Defense Forces l statement said, alluding to tensions that surged after the August 25 drone incident in a Hezbollah stronghold in a Beirut suburb.
There was no immediate comment from Hezbollah, which has denied having precision-guided missile production sites in Lebanon. But it says it possess such weapons, which could be used to home in on and knock out key Israeli infrastructure.
In an August 31 speech, Hezbollah leader Hassan Nasrallah accused Israel of using the movement's capability with precision-guided missiles as a pretext for attacks.
Israel has not formally claimed responsibility for the Beirut drone strike, which a regional security source said hit a component of the precision-guided missile project.
Hoping to move Beirut to rein in Hezbollah, Israel has signalled that in any further flare-up it could carry out widespread attacks on Lebanon.