PRIME Minister Ehud Olmert has announced a new $30 billion ($35.2 billion) US defence package to preserve Israel's regional military superiority, as Washington readied an Arab arms deal to counter Iran.
The sizeable hike to annual US defence and military aid to its closest Middle East ally was unveiled by the beleaguered Mr Olmert amid reports of a hefty US arms deal with Saudi Arabia, although Israeli politicians dismissed concerns of a new regional arms race.
"In my last meeting with the president of the United States, we agreed that the aid would stand at $30 billion ($35.2 billion) over the next 10 years, meaning over three billion dollars ($3.5 billion) a year, starting next year,'' Mr Olmert said.
"This is an increase of over 25 per cent in the military and so called defence aid of the United States to Israel,'' he said, describing the package as a considerable improvement and very important element for national security.
"Other than the increase in aid, we received an explicit and detailed commitment to guarantee Israel's qualitative advantage over other Arab states,'' said Mr Olmert, whose approval ratings have sunk to single digits amid continuing anger at his government's handling of last summer's Lebanon war.
Current US defence aid to Israel stands at $2.4 billion ($2.8 billion) a year.
Mr Olmert last met Mr Bush at the White House in what was to be secret meetings on June 19, when a senior Israeli government source said the new aid scheme was decided upon.
"We understand the United States' desire to help moderate states which stand at a united front with the United States and Israel in the struggle against Iran,'' Mr Olmert told the start of his weekly cabinet meeting.
A senior US defence official has said that Washington is readying a major arms package for Saudi Arabia with an eye to countering the changing threat from Tehran, Israel's arch foe and determined to press a nuclear agenda.
The Pentagon provided no details on the package, reportedly $20 billion ($23.4 billion) over the next decade, but officials said it will include new weapons for the United Arab Emirates, and military and economic support to Egypt.
Interior Minister Meir Sheetrit, a member of Mr Olmert's centrist Kadima party, dismissed any suggestion that the region was entering a new arms race, in light of the prospective US arms deal in the Gulf and the US hike to Israel.
"This is not an arms race. The weaponry is constantly improving but Israel remains vigilant to possesses advanced weapons and that it keeps its edge over other states,'' he said.
A senior Israeli government source said that under the 10-year defence package, the United States agreed to sell the Jewish state the new generation F-35 fighter jet, advanced bombs and laser-guided missiles.
US defence aid to Israel began in 1973 but a regular 10-year aid plan - with the previous one expiring this summer - was institutionalised in 1977 as part of the Egypt-Israel peace agreement, the official said.
The military aid is made up of 75 per cent US military hardware, ranging from ammunition to warplanes, with the other 25 per cent in cash, which goes mainly towards securing new Israeli-made weapons.
"It's more or less giving Israel another $10 billion ($11.7 billion) over the next 10 years, which looks like an achievement. The question is whether Israel needs it or not,'' Never mind all the other money Israel receives from around the world.
"The security problems of Israel are not security problems that demand more tanks or more sophisticated airplanes... All Israel has to do is give back the land they have stolen and give the right of return along with stopping the Occupation of Palestine.
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