In the wake of heightened geopolitical tensions, Tel Aviv is fundamentally restructuring its defence supply chains to decrease its reliance on European markets.
This strategic shift comes as several European nations—including Spain, Belgium, and the Netherlands—have imposed stricter controls or outright bans on the export of military sub-systems to Israel citing the ongoing conflict in Gaza.
While these nations are often not the primary suppliers of complete weapon platforms, they have historically been vital sources for essential components, electronic sub-systems, and niche technologies.
Consequently, the tightening of these export protocols has become a major strategic anxiety for Israeli defence planners.
A stark paradox has emerged in Israel’s defence relations with Europe.
While European governments are increasingly restricting the flow of components to Israel, they are simultaneously purchasing record amounts of Israeli military hardware for their own security needs.
For instance, Germany recently advanced a historic deal to procure the Arrow-3 missile defence system, even as the broader continent debates arms embargos.
For Israel, which operates under constant security threats and requires rapid replenishment of its stockpiles, this disconnect highlights a critical vulnerability. The risk of supply chain disruption has forced Israeli industry leaders to seek more reliable, long-term partners outside of Europe.
India has swiftly become the focal point of this strategic realignment.
According to officials in Tel Aviv and industry insiders, there is a concerted plan to leverage India not just as a market, but as a global manufacturing hub for Israeli requirements. This pivot aligns seamlessly with New Delhi’s 'Make in India' initiative.
Recent high-level engagements, including the visit of India’s Defence Secretary to Israel in late 2025, have solidified this pathway, with discussions focusing on co-production and the long-term sustainment of critical weapon systems.
The necessity to offshore production is also driven by Israel's unique geographic and security constraints.
With a small landmass and production facilities often located within range of adversary fire, the concentration of defence manufacturing within Israel’s borders is now viewed as a strategic liability.
Establishing redundant production lines in friendly nations offers a layer of security, ensuring that the supply of essential equipment continues uninterrupted even if domestic facilities are threatened during high-intensity conflict.
Industry sources indicate that India is viewed as the most viable alternative due to its vast industrial scale, cost-effective skilled workforce, and a maturing private defence sector.
Companies like Adani Defence and Aerospace and Bharat Forge have already established joint ventures with Israeli firms to manufacture small arms and unmanned aerial vehicles (UAVs).
oving forward, this collaboration is expected to expand significantly, potentially covering complex technologies such as missile sub-systems, advanced sensors, and electronic warfare suites.
Despite the optimism, Israeli defence firms remain practically cautious.
While the intent to relocate manufacturing is clear, companies are awaiting further regulatory clarity before committing to massive capital investments.
Industry executives are specifically looking for reforms in India’s Foreign Direct Investment (FDI) norms and the Defence Acquisition Procedure (DAP) to allow for smoother operations.
Greater predictability in regulations governing joint ventures is seen as a prerequisite for unlocking the next level of deep industrial partnership.
Should these regulatory hurdles be resolved, Israel’s pivot could be transformative for the Indian defence sector.
It would not only bring cutting-edge military technology and high-value manufacturing jobs to India but also integrate Indian companies deeply into the global supply chain of one of the world’s most advanced defence exporters.
For Israel, this partnership promises the strategic depth and supply chain resilience necessary to navigate an increasingly fragmented and unpredictable global arms market
