Iran Fears Drive Mid-East Arms Rush

Iranian protesters defied Ayatollah Ali Khamenei’s warnings of “bloodshed” and took to the streets over the weekend, to protest the country’s allegedly rigged election. Riots cops responded with batons, tear gas and water cannons. Earlier, hard-line Basji militias reportedly broke into protesting students’ dorms, to intimidate or even beat them. No one knows how the […]

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Iranian protesters defied Ayatollah Ali Khamenei's warnings of "bloodshed" and took to the streets over the weekend, to protest the country's allegedly rigged election. Riots cops responded with batons, tear gas and water cannons. Earlier, hard-line Basji militias reportedly broke into protesting students' dorms, to intimidate or even beat them.

No one knows how the escalating protests will play out, in the end. More broadly, regional worries over Iran have propelled a lucrative arms market, dominated by U.S. defense firms. While most countries cut back their military spending, due to the global recession, many of Iran's neighbors are continuing years-long shopping sprees for high-tech arms, apparently aimed at building an iron wall around Iran. Egypt, Israel, Iraq, Saudi Arabia and the UAE account for the majority of sales, projected to total $70 billion, this year. The bulk of the sales are for fighter jets and missile defenses.

The U.S. is careful not to single out Iran as the major factor in weapons sales. “This is about building a more secure world,” said Bruce Lemkin, a U.S. Air Force official who oversees many arms deals. But Egyptian President Hosni Mubarak was less circumspect, when he told his political party that “the Persians are trying to devour the Arab states.” Forecast International is equally forthright, citing “worries over Iran” as the major driver of military investment by the Arab states and Israel.

Using weapons exports to shore up defenses against Iran is a calculated move by the Obama administration, experts say. Defense industry analyst Jim McAleese said the Pentagon is boosting subsidies to Middle East weapons buyers, using so-called "defense-wide" funds to shore up allies' defenses. It's cheaper in the long run to help other countries pay for the weapons they need to fight their own battles, than it is for the U.S. to deploy its forces, McAleese said.

[PHOTO: IDEX]