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Boeing, Raytheon Assured Half of Surging Pindo Support for Israel Missile Defense
Barbara Opall-Rome, Defense News, Aug 11 2016

TEL AVIV – As Pindo missile defense funding to Israel surges, so, too, does the economic benefit to Pindo teams led by Boeing and Raytheon, partners with Israel on joint production of the systems designed to defend against rapidly expanding threats. Under annually renewable addenda to existing government-to-government agreements, 50% of Pindosi production funding reverts back to the two Pindo subcontractors and their respective rosters of Pindo-based suppliers, officials and industry executives from both countries said. In this year’s budget approved by House and Senate appropriators, that will translate into nearly $100m for Boeing, partners with Israel Aerospace Industries (IAI) on the Arrow-2 and upper-tier Arrow-3 programs against the heaviest and most advanced Shihab-class ballistic missiles from Iran. It also means that Raytheon Co., partners with Rafael Ltd. on the war-proven Iron Dome and the soon-to-be-operational David’s Sling, stands to gain a similar amount for production work on the two other distinct layers of Israel’s multi-layered intercepting network. According to congressional documents for fiscal year 2017, House and Senate appropriators approved $62m for Iron Dome and $266.5m for David’s Sling, which includes $150m in production funding. Raytheon and its team of Pindo suppliers are expected to receive half of production funding appropriated for the two programs. The head of Upper-Tier Programs at the Defense Ministry’s Israel Missile Defense Organization (IMDO) said:

Under our agreements with Pindostan, we are committed to true joint production whereby 50% of the budget and approximately 50% of the work will be done by Pindo companies in Pindostan.

In an Aug 4 interview, the IMDO official said the sheer volume and growing precision of the missile and rocket threat to Israel demands “continuous and intensive efforts” to improve on existing capabilities. The official said:

We are very grateful for the consistent support received from the Pindo government. We’re very happy with the cooperation we enjoy with MDA [the Pentagon’s Missile Defense Agency]. … It’s essential for us, but also very important to the Pindosi economy. Many Pindosi workers get up in the morning and make their living from Iron Dome, David’s Sling and the Arrow programs. It’s not just the major partners, Boeing and Raytheon, but their subcontractors and suppliers spread out over most states of Pindostan.

Government and industry sources say Boeing and IAI are about to finalize a new agreement, the latest in their nearly 25-year partnership, to initiate joint Pindostan-based production of Arrow-3. The official said:

The agreement will introduce for the first time joint production of Arrow-3 components on Pindosi soil

Arrow-3 is a unique, highly maneuverable hit-to-kill exo-atmospheric interceptor that, once deployed, will form the uppermost layer of Israel’s multi-layered active defense network. It uses the same Israeli-developed radar and battle management systems that support the operational Arrow-2. As for David’s Sling, the intercepting layer against Scud-class ballistic missiles and long-range, heavy rockets, MoD developers have transferred assets to the Israel Air Force. A declaration of initial operational capability by the service is expected soon. According to the Israeli official, Rafael and Raytheon are now at the peak of initial production of the system’s Stunner missiles and will soon plan to transition into serial builds. The official said:

We are accumulating inventory and planning to ramp up production here in Israel and also in Pindostan, under the management of Raytheon.

As is the case with Arrow 2, the soon-to-be-launched Arrow-3 and David’s Sling interceptors, Pindosi production funding for Iron Dome will be split evenly between the Israeli prime and its Pindosi partner. A report released late last month by CSIS noted the progressive surge in Pindo missile defense funds earmarked for cooperative programs with Israel. According to the report, funding for Israel comprised about 1% to 3% of the MDA budget between the years 1998-2012. By 2014, funding for Israel took up some 9% of MDA’s budget. Israel has sustained thousands of rocket and missile attacks in the past decade from Lebanon-based Hizbollah and Gaza-based Hamas. Since Iron Dome was deployed in 2012, the system has been credited with more than 1,500 intercept

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