Israeli defense exports for 2010 are expected to match the all-time high reached in 2009, according to Defense Ministry officials. The record year of 2009 saw exports reach $7.4 billion.

Based on calculations of new orders from Israeli defense companies, the export totals for 2010 exceeded $7.3 billion and will probably match those of 2009 once figures for support and follow-on contracts are finalized.

Some 80 percent of all Israeli defense production is sold on the export market. The country's export order totals have steadily grown, reaching $3.5 billion in 2005, $4.9 billion in 2006, $5.6 billion in 2007, and $6.6 billion in 2008.

But Israeli defense officials warn that such steady growth may come to a halt in the coming years as relations with once-dependable customer Turkey are strained and European nations continue to slice defense spending.

While India and North America constitute Israel's largest defense trading partners, U.S. military demand is expected to slow in the face of debt pressures, and Israel's growing diplomatic isolation may serve to erode sales opportunities abroad.