Trump's Aid Cut Threatens $10 Billion in Israeli Arms Orders

President Donald Trump's recent announcement to halt U.S. military aid to Israel by year's end has raised concerns about the future of bilateral security cooperation, particularly regarding the funding of already placed arms deals. According to a Wall Street Journal report, Israel has ordered U.S. military equipment worth billions of dollars beyond the committed aid, and the aid suspension could leave some orders without clear financing.

A U.S. State Department document submitted to Congress indicated that as of April 1, approximately $10 billion was needed to fund existing orders beyond the aid already pledged to Israel. It remains unclear if this figure has changed. The document suggested that these commitments could be financed through U.S. aid funds, Israel's own budget, or a combination of both.

Trump's statement, which reportedly surprised Israeli officials including security personnel, follows his declaration on Tuesday about stopping payments to Israel by the end of the year. Prime Minister Benjamin Netanyahu has previously stated that Israel should gradually reduce its reliance on U.S. aid, suggesting its cessation within the next decade.

Israel currently receives about $3.3 billion annually in U.S. military aid, primarily for purchasing American-made equipment like fighter jets and armored vehicles. This aid is part of a ten-year agreement signed under the Obama administration, valid until 2028. Additionally, Congress approved a separate $26 billion aid package for Israel in 2024 amid the Gaza war.

A feature of the aid mechanism allows for using future U.S. commitments to place current orders, offering flexibility in acquiring weaponry but creating financial obligations extending beyond the aid agreement's term. Democratic Congressman Joaquin Castro noted that even if the current agreement continues until 2028, around $10 billion in orders would still require funding.

Meanwhile, some U.S. lawmakers are proposing a shift in the security cooperation model from direct grants to investments in defense and joint production of military technologies. Proponents argue this would deepen collaboration, citing projects like the Iron Dome system. Critics, however, warn it could entangle Israel more deeply in Pentagon supply chains, making future adjustments difficult. Regardless, joint production may not address Israel's immediate procurement needs, including a planned purchase of 25 advanced F-35 fighter jets.

Despite Trump's declaration, current and former U.S. officials deem an immediate aid halt unlikely. Josh Paul, a former State Department official who resigned in protest of U.S. support for the Gaza war, told the Wall Street Journal that ending aid by year's end is impractical due to funds already approved by Congress and a lack of concrete steps to implement the announcement.