Key points
- Israel’s military expenditure surged by 65pc to $46.5b in 2024
- Iran’s military spending fell by 10pc to $7.9b in 2024
- Israel’s military spending has grown by 135pc over past decade
- Drop in Iranian defence outlays is linked to economic challenges
ISLAMABAD: According to a recent analysis by the Stockholm International Peace Research Institute (SIPRI), a prominent independent think tank, Israel and Iran followed different trajectories in their defence spending during 2024—reflecting not only their regional strategic calculations but also the broader economic and political contexts shaping each state’s decisions.
Israel recorded an unprecedented surge in its military expenditure, increasing by 65 per cent compared to the previous year. This brought its total defence budget to an estimated $46.5 billion—the most significant annual rise since the 1967 Six-Day War.
Over the past decade (2015–2024), Israel’s military spending has grown by 135 per cent. Military expenditure as a share of GDP jumped from 5.4 per cent in 2023 to 8.8 per cent in 2024, making Israel the country with the second highest military burden in the world, following Ukraine.
Intensified security situation
This sharp increase has been largely attributed to the intensified security situation in the region. The ongoing invasion of Gaza, coupled with the escalation of hostilities with Hezbollah in October 2024, prompted Israel to revise its initial military budget for the year.
From an early allocation of $37.1 billion, spending rose significantly, reaching $45.6 billion by December. Notably, in that month alone, Israel allocated $5.7 billion to defence—highlighting the scale of its mobilisation.
Iran’s military spending
In contrast, Iran’s military spending was markedly restrained. Total expenditure for 2024 stood at $7.9 billion, which represents a 10 per cent decline from 2023.
While still 21 per cent higher than its 2015 level, the year-on-year drop in Iranian defence outlays is primarily linked to the economic challenges arising from sustained high inflation, according to SIPRI.
This inflation has been exacerbated by the ongoing regime of economic sanctions, particularly those led by the United States. These sanctions, which were further expanded in 2024, have targeted Iran’s nuclear activities and its regional alliances. The restrictions have also negatively impacted Iran’s oil exports—its main source of national income.
