Military Spending, Modernization, and the Shifting Military Balance

By Anthony H. Cordesman and Nicholas Harrington

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The military balance between Iran, its Arab neighbors, and the United States has been a critical military issue in the Middle East since at least the rise of Nasser in the 1950s. The risks this arms race presents in terms of a future conflict have not diminished with time, and many elements of the regional arms race have accelerated sharply in recent years.

Clashes with Iran in the Gulf, struggles for influence in Iraq and Syria, and the war in Yemen all act as warnings that new rounds of conflict are possible. The Iranian reactions to the U.S. withdrawal from the JCPOA nuclear agreement, the growing tensions between the Arab Gulf states, the boycott of Qatar, and the unstable outcome of the fight against ISIS, and the Syrian civil war all contribute to an increasingly fragile and dangerous security environment.

The Growing Risk from a Regional Arms Race

On July 22nd, Iran’s President Hassan Rouhani warned the U.S. that, “Mr. Trump, don’t play with the lion’s tail, this would only lead to regret. America should know that peace with Iran is the mother of all peace, and war with Iran is the mother of all wars. You are not in a position to incite the Iranian nation against Iran’s security and interests.” The next morning, President Trump replied with a Tweet in full capitals stating that,

“NEVER, EVER THREATEN THE UNITED STATES AGAIN OR YOU WILL SUFFER CONSEQUENCES THE LIKES OF WHICH FEW THROUGHOUT HISTORY HAVE EVER SUFFERED BEFORE. WE ARE NO LONGER A COUNTRY THAT WILL STAND FOR YOUR DEMENTED WORDS OF VIOLENCE & DEATH. BE CAUTIOUS!”

No one can safely dismiss such rhetoric as political posturing due to the fact the U.S. is imposing steadily more serious economic sanctions on Iran. The history of war is as much the history on unintended conflicts and escalation as of deliberate attacks. There have already been far too many such wars in the Middle East, and the current arms race has far too long and dangerous a history to ignore.

Examining the Impact of Iranian and Arab Gulf Military Spending, Arms Transfers. Military Modernization, and Changes in the Balance and Nature of Gulf Forces

The Burke Chair at CSIS is issuing a new version of a report that uses a wide range of tables, graphs, and maps to examine the military balance between the Arab Gulf states and Iran. This report is entitled, The Arab Gulf States and Iran: Military Spending, Modernization, and the Shifting Military Balance and is available on the CSIS web site in PDF version at https://csis-prod.s3.amazonaws.com/s3fs-public/publication/181212_Iran_GCC_Balance.Report.pdf, and in PowerPoint version at https://csis-prod.s3.amazonaws.com/s3fs-public/publication/181212_Iran_Gulf_Balance.Report.pptx. 

It draws heavily on both official open source reporting and the work of major research centers like the International Institute for Security Studies (IISS) and the Stockholm International Peace Research Institute (SIPRI), as well as a variety of other think tanks and commercial research centers. It notes the critical role of the United States and European forces like those of Britain and France in shaping the balance, as well as the emerging role of Russia, but focuses on the detail trends in Iran, Iraq, and the Southern Arab Gulf states - Bahrain, Kuwait, Oman, Qatar, Saudi Arabia and the UAE.

The report compares a range of sources to trace the history of the Gulf arms race in terms of military expenditures, arms transfers, and comparative rates of military modernization. In the process, it examines the economic burden on the Gulf states of these military expenditures and arms transfers, the recent shifts in the balance in terms of the major elements of conventional warfighting capability, and the impact of a steady shift towards options for asymmetric warfare.

The report is divided into twelve main sections, each of which is summarized below.

Focus and Methodology 

While Iran is sometimes perceived as the military "hegemon" of the Gulf, many of its conventional military forces are equipped with aging, battle worn, and mediocre weapons that make it something of a military museum. Iran has not had good access to modern weapons since the fall of the Shah, and the Arab Gulf forces are generally equipped with the most modern and effective weapons available from the U.S. and Europe and would be supported by the U.S., Britain, and France in any serious warfighting contingency.

At the same time, Iran has made major advances in creating a large mix of ballistic and cruise missiles, asymmetric forces that can threaten shipping throughout the Gulf and in the Gulf of Oman and Red Sea, and expanding its military influence and presence in Lebanon, Syria, Iraq, and Yemen. Iran has skillfully exploited the self-destructive divisions within an Arab world that has never created an effective structure of alliances, wasted much of the money it has spent on military forces and arms transfers, and is now divided by the Saudi-UAE led boycott of Qatar.

U.S. and European power projection can guarantee an Arab victory in any serious conventional conflict, but it cannot compensate for Arab dysfunctions, divisions, and self-inflicted wounds.

A. Regional Military Expenditures: IISS and SIPRI Data 

The trends in military expenditures form the initial core of this analysis, and there are important limits to the data. Neither the Arab states nor Iran provide anything resembling credible reporting on their military expenditures and arms transfers. This lack of transparency has helped lead to sharply conflicting estimates – or simply no estimate – of the spending of key states, sharply encouraged waste and corruption, and sharply limited regional analysis of the military balance, and the effectiveness of national forces.

However, an analysis of the reporting by two key think tanks – the International Institute of Strategic Studies (IISS) and the Stockholm International Peace Research Institute (SIPRI) – and IHS Janes reflects estimates that the Arab GCC states spent $95 to $128 billion on military forces in 2017. This is six-to-nine times their estimate that Iran spent $15 to $16 billion. This also reflects a consistent trend in such estimates. The Arab Gulf states have sharply outspent Iran for decades.

It is likely that the true total for both the Arab GCC states and Iran was significantly higher than these think tanks report, but this would not change the relative Arab lead. Moreover, both the think tank data, and the U.S. official data in the next section of this report strongly argue that the U.S. complaints about Arab Gulf burden sharing are quantitative nonsense.

All the Arab Gulf states spend far more of their economies on military forces than the 2% of GDP goal set by NATO, and far less than the 3.11% the IISS estimates is spent by the U.S., the 3.10% spent by Russia, and the 1.26% spent by China.

Three such states – Iraq, Oman, and Saudi Arabia – spend more than 10%. While the Qatar and the UAE lack the integrity and transparency to report meaningful data on their military spending, it is likely that both obligated close to 10% or more in 2018 – driven by a surge in Qatari arms buys and the UAE's war in Yemen. These are levels of military spending that threaten the economic development and reform efforts in each such state that are critical to internal stability and fighting extremism and terrorism.

B. Country Military Expenditures: U.S. State Department Data

The U.S. State Department. provides a comprehensive estimate of military spending, arms transfers, and military personnel in an annual document called World Military Expenditures and Arms Transfers (WMEAT) (https://www.state.gov/t/avc/rls/rpt/wmeat/2017/index.htm). This document provides an authoritative U.S. official estimate of the key financial trends shaping military developments on a global basis and provides a range of different ways of calculating the military burden for each country. It involves a truly massive analytic effort. As a result, the latest edition was issued at the end of 2017, but only covers trends and developments through 2015.

In broad terms, however, it supports the trends in the IISS, SIPIRI, and IHS Janes estimates. The data for 2015 reflect a lower level of military effort than 2017 but indicate that the Arab Gulf states spent 11.3 times more than Iran (12.9 times if Iraq is included) and could buy far more capable forces if they took an integrated approach to force planning focused on their key missions, if they were less divided and dysfunctional, and if the divisions between and within the Arab states did not offer Iran so many self-inflicted wounds to exploit.

At the same time, the WMEAT data also again indicate that President Obama and President Trump's criticisms of Arab Gulf burden sharing were based on remarkably bad and misleading U.S. staff work. The 2015 data precede the cost of the Yemen War and the impact of the boycott of Qatar, but every Arab Gulf state spent at least 3% of its GDP, most spent close to 5% or more, and two (three including Iraq) spent well over 10% of their GDP.

C. Arms Transfers: SIPRI Estimates 

The data on world arms transfers are notoriously unreliable, and lack full comparability and clear definitions. The problems in such estimates are touched upon in this section, but it also makes it clear that SIPRI has created a relatively consistent data base which focuses on major weapons transfers.

Like the data on military expenditures, the SIPRI data indicate that the Arab Gulf states have had a massive advantage over Iran in such sales, and one reinforced by access to the most modern weapons and military technology – although the impact of this advantage has been sharply reduced by a lack of integration and interoperability and focus on key missions in deterring and fighting Iran. 

Later in this section, however, there are tables showing the shifts in the regional balance that occurred because of the U.S. invasion of Iraq – and the U.S. failure to create a stable regime in that country. The U.S. mistakes in invading Iraq, and the invasion’s aftermath – may well have done more to empower Iran between 2003 and 2018 than the mix of Gulf Arab mistakes.

D. Global Arms Transfers: U.S. Government Estimates 

The best unclassified estimate of arms transfers is provided in a declassified official U.S. estimate of arms transfers in dollars provided by the U.S. Congressional Research Service (CRS) in Conventional Arms Transfers to Developing Nations, 2008-2015, and additional data are provided by the U.S. State Department in WMEAT.

There are many issues in making such estimates that need to be examined in depth, but it is clear that the Arab Gulf nations have spent far more on arms imports than Iran and have had far better access to advanced arms and military technology. The summary trends are shown below:

Many Arab imports, however, seem more oriented towards getting the most advanced weapons rather than the ones needed to best deal with the threat posed by Iran and extremism. While most Arab imports are technically interoperable, they lack standardization and come from a wide range of supplier countries with different mixes of suppliers in each state – some of which cannot supply interoperable arms. This approach to purchasing is wasteful, and the lack of transparency almost certainly encourages serious levels of corruption.

E. U.S. Government Reporting of U.S. Arms Sales

Most arms exporting governments do not provide summary or detailed data on their overall arms transfers and sales to the Gulf or other importing states. The U.S. government is an exception. It reports such data on U.S. arms transfers and sales through its Department of Defense Security Cooperation Agency (DSCA). These reports provide data on U.S. arms sales back to 1950, and show the actual current dollar value of such transfers, aid, and sales.

The data in Figure E1 to Figure E-10 are particularly striking in showing the major levels of increase in U.S. arms sales and deliveries since 2001, and the high rate of further increase after 2010:

In addition, the Department of Defense Security Cooperation Agency (DSCA) submits every proposed major arms sale request to the State Department and the Congress for review. It reports these requests in public, and on the Web. This transparency provides one of the few reliable pictures of the true nature and cost of such sales. Many other sales are not reported, are reported inaccurately, or are announced in ways designed to encourage further sales or boost a given weapon, manufacturer, or political position.

It is not possible to analyze more than a few individual sales in this report, but Figure E-11 provides a chronological summary of these reports on individual arms sales since the inauguration of President Trump. It shows just how much of the flow of U.S. arms sales consists of the services necessary to support Arab strategic partners in arming and operating their weaponry, the level of modernization taking place in existing systems, and the emphasis placed on sustainability and making weapons transfers effective in actual combat.

It is also clear that many sales provide maintenance, training, and other services as well as support equipment, facilities, etc. This is a key part of U.S. arms transfers under the FMS program. FMS sales are structured to ensure that the buyer country acquires the capability to properly support and operate the arms it buys and avoid hollow or showpiece buys of major weapons.

F. Recent U.S. Arms Sales Under President Trump

The size of U.S. arms sales to Saudi Arabia and the Arab Gulf states since President Trump took office has become the subject of significant controversy for reasons that go far beyond the massive mistakes the U.S. is making in assessing the burden sharing efforts of its Arab strategic partners. President Trump has placed a heavy emphasis on U.S. arms sales to Saudi Arabia and other Arab Gulf states since he took office. While politics are politics and exaggerated claims are the primary bipartisan rule of political truth, he also has sharply exaggerated the size of U.S. sales, the growth in such sales since he took office, and their impact on creating jobs.

In fairness, various Presidents from both parties have exaggerated the value of such sales ever since the U.S. debate over the sale of the AWACS to Saudi Arabia began in 1981. Nevertheless, President Trump has pushed such claims to unusual levels.

He first took credit for such sales proposals in a meeting with Mohammed Bin Salman, the Crown Prince of Saudi Arabia, on March 20, 2018. He displayed two poster boards during televised coverage of the meeting. One claimed $12.5 billion in "finalized" arms sales to Saudi Arabia, including $3 billion worth of Standoff Attack missile sales, $533 million in CH47 sales, $533 million in Threat Detection Aerostats, $880 million in M1 tank upgrades, $63 million in artillery shells, $889 million worth of Harpoon II missiles, $6 billion worth of MMSC frigates, and $645 million worth of Joint Standoff missiles.

The second showed "sales pending" and included $13 billion worth of THAAD ABMs, $3.8 billion worth of C-130s, $1.4 billion worth of Poseidon MPA/AWACS aircraft, and $1.2 billion worth of Bradley armored fighting vehicles. In displaying these sales, the President took credit for creating 40,000 jobs and some $19.4 billion in deals, although almost all had been planned or negotiated by President Barack Obama and were not firm sales.

Many of the problems with these claims were summarized in an article by Glenn Kessler in the Washington Post on October 22, 2018. (https://www.washingtonpost.com/politics/2018/10/22/trumps-claim-jobs-saudi-deals-grows-by-leaps-bounds/?utm_term=.440c2b1b7226).

If anything, Kessler understates the exaggerations involved regarding job creation, many of which can scarcely be blamed upon the President. The Office of the Secretary of Defense has meaningful factual support for most of the dollar to job estimates it issues, and the actual number of jobs per sales dollar steadily declines over time as high technology equipment comes to rely more and more on highly skilled labor, robotics, and other forms of automation.

As for actual sales, Figure F-1 provides an official sale-by-sale chronology – taken from the reporting by the Defense Security Cooperation Agency (DSCA) of the Department of Defense of the proposed (not final) arms sales to all of the Arab Gulf states, including Iraq, from the date of the President's inauguration through December 1, 2018 – a period that covers all the claims listed by Kessler.

Even if one counts all of these proposed sales as actual sales and ignores the fact most were proposed under President Obama, the totals were only $26.9 billion in 2017 and $5.8 billion in 2018, for a total of $32.8 billion. The portion of these sales that would be made to Saudi Arabia would be far more limited: $20.1 billion.

The good news is that some of the potential sales listed in Figure F-1 do reflect an emphasis on key missions like air and ballistic missile defense, on fully supporting advanced multirole fighters, and some limited emphasis on forces that can counter Iran's asymmetric naval threats. The overall patterns in Arab Gulf arms buys also reflect a shift towards buys that can increase true operational interoperability, create more effective warfighting cooperation with U.S. power projection forces, and emphasize deterrent and warfighting capabilities rather than prestige buys and the military "glitter factor."

Figure F-1 also shows, however, that the total size of recent U.S. arms sales is not, however, anywhere near $100 billion to $125 billion. These numbers bear no clear relation to reality. Furthermore, the data in Figure F1 show that even if one disregards the fact DSCA reports proposed – not actual – U.S. arms sales, and that the totals in the Figure include also reported sales that have occurred since President Trump's Inauguration – even though most such sales were proposed before President Trump took office – the totals were only $26.9 billion in 2017 and $5.8 billion in 2018, for a total of $32.8 billion.

So far, only about half these total sales to all Arab Gulf states seem likely to be final. The Saudi portion also totaled $17.2 billion in 2017 and $2.9 billion in 2018, for a total of $20.1billion. These are still massive potential purchases, but they fall far short of some political claims.

F. Force Numbers and Trends

Given the patterns in total military spending and arms sales, it is scarcely surprising that the broad trends in force, personnel, and equipment numbers show that the Southern Arab Gulf states have a clear lead in major weapons numbers in most areas of conventional arms. Iraq is still a limited power, and Iran’s only lead is in manpower. It should be noted that this figure draws on IISS sources and IHS Janes. Other sources often have different figures.

Iran did make a major recovery in some areas of major land force weapons numbers from 1991 to 2003 and beyond, but it has not sought major increases in numbers since 2003 and has focused more on weapons quality. It has, however, retained a massive force of towed artillery and towed/SP rocket launchers. It has increased its air strength, but the numbers shown do not reflect fully operational or sustainable forces. Iran has modified many systems to keep them operational, but the quality of such efforts is highly uncertain. The same is true of many surface-to-air missile systems, and inventory age is a problem in ensuring some such systems remain operational and reliable.

G. Military Modernization

As might be expected from the patterns in arms transfers, the patterns of modernization in the Arab Gulf states and Iran reflect the impact of the military expenditures and arms transfers discussed earlier and provide broad indicators of the relative rise in total Gulf Arab force strength and capability relative to Iran.

A close examination of Iran’s land, air, and sea-based military modernization efforts reveal that key Iranian force systems are obsolete, obsolescent, or of relatively low quality. Many systems date back to the Shah or were worn during the Iran-Iraq War. Non-operational rates are likely high for many of these systems, and combat sustainability is likely low as well.

However, much depends on how they are interpreted. Arms transfers are only useful to the extent they actually result in useful military modernization in key mission areas that enhance deterrence and warfighting capability relative to a potential threat or enemy. Success goes far beyond making the right choices in weapons and technology. It means creating effective, truly combat ready, forces that can carry out the right missions.

Each section of the analysis shows that the Arab Gulf States have used their military spending and arms imports to develop a decisive overall edge in conventional weapons and modernization over Iran. At the same time, the Arab Gulf effort has lacked coherence and a focus on the right capabilities and missions and has put far too many resources into conventional airpower at the expense of other mission priorities.

Iran’s ballistic and cruise missiles, asymmetric warfare capabilities, improving land-based air defenses, and use of strategic partners and sub-state actors can scarcely be ignored. Iran has exploited Arab political divisions using political support and elements of its IRGC Quds Forces, money, weapons transfers, volunteers, and train and assist efforts with great success.

There is no clear terminology for such efforts. The term “hybrid warfare” can be stretched to describe such Iranian efforts, but most do not involve any meaningful direct Iranian intervention in combat. If anything, they follow the model advocated by Sun Tzu of using force indirectly and in ways short of war to achieve a strategic objective.

Iran has focused on exploiting the internal and national divisions and conflicts within Arab states. It has backed non-state actors like Hezbollah in Lebanon, Hamas in Gaza, Shi’ite factions and militias and some Kurdish elements in Iraq, the Houthi in Yemen, and even Sunni extremist groups like elements of Al Qaida. Its efforts have generally been consistent and well-focused, while Arab efforts have consisted largely of money transfers that have been grossly inconsistent, conspiracy oriented, and often conflicting – such as the Saudi and Qatari efforts in Syria.

Far too often, the burden of direct military support has fallen on the U.S. and its airpower and ground force train and assist efforts – areas where the U.S. has had military success but often failed to create effective political, governance, and civil efforts and achieve any broad strategic success. The U.S has demonstrated the limits to what an outside and very different outside culture can accomplish ever since 2003, and Iran has been able to skillfully exploit the resulting power vacuum without having to go to war.

Iran has also steadily procured weapon systems that enable it to pose an outsized asymmetric threat relative to its conventional military strength, its poor economy, and its lack of access to world markets. Iran has focused on creating a major ballistic and growing cruise missile/UAV threat, improved land-based air defense, and a naval-missile-air capability to attack maritime forces and coastal targets. It has also used its build-up of its strategic partners, usually sub-state actors, to both expand its regional influence and create a potential strategic buffer to any land attack through Iraq.

The following sections of this report reflect many areas of Gulf Arab success in modernizing individual national forces, but the divisions in the Gulf Arab states, and their somewhat mechanical emphasis on increasing their conventional forces – over-emphasizing air a combat and attack capabilities in the process – have failed to respond effectively to Iran and left them far too dependent on the U.S. and European aid for the money they are spending.

Key areas of overall Gulf Arab weakness – which do vary sharply by country where some countries have created highly effective individual force elements – include:

Internal divisions and bickering in every aspect of military development and activity.

Ambitious strategic conferences, meetings, and pro forma alliances with little real substance.

De facto over-reliance on U.S. and European power projection and actual command and battle management in a serious conflict, as well as U.S. led train and assist efforts in fighting extremist/terrorist movements and dealing with internal Arab state conflicts and sectarian and ethnic violence.

Creation of relatively static land forces designed for national territorial defense against conventional enemy forces – although some Special Forces, counterterrorism forces, and other elite elements in specific, but few, countries are very good.

Reliance on limited and often set-piece formal exercises and token common training with limited relation to probable war fighting scenarios.

Weak real-world emphasis on joint warfare doctrine, training, real-world capability, and day-to-day operations.

Spending far too much on prestige buys of fighter-attack aircraft and advanced air-launched munitions without creating adequate integrated and/or advanced BM/C4(battle management/command, control, communications and computer), IS&R (intelligence, surveillance, and reconnaissance), refueling, maritime patrol and sensor, and AWACs (airborne air control and warning system) capability.

Erratic nation-by-nation, land-based air defense forces and modernization efforts that are not properly integrated, often poorly deployed or used to protect leadership cadres.

Failure to buy the naval systems and other forces necessary to directly address the threat posed by Iran asymmetric naval-air-missile threat to Gulf shipping inside the Gulf, at the Strait of Hormuz, in the Gulf of Oman, and increasingly at the Bab el Mandab and in the red Sea. This includes a lack of adequate regular and smart mine warfare capability, capability to deal with IRGC guided missile and high explosive attack boats, capability to defend against the fully range of Iranian anti-ship missile, inadequate naval-air joint warfare and surveillance and targeting capability, lack of adequate and integrated BM/C4 capability, and poor overall naval readiness and real-world training capability within a number of Gulf Arab countries.

Lack of real-world progress in acquiring ballistic missile and cruise missile/UAV/UCAV defenses that must be integrated to be cost-effective, require a common layered architecture emphasizing endo-atmospheric defense, and which will become progressively more important if Iran succeeds in deploying precision-guided ballistic and cruise missiles or deploys nuclear or CBW warheads.

Serious gaps in some national real-world manpower and readiness capabilities to sustain serious combat operations.

Establishing ambitious counterterrorism/counterextremism alliances and centers, and major new facilities, that generally have little real effectiveness and operational value. Limited progress in addressing the internal sectarian, ethnic, and tribal divisions; ideological/education; and youth career and employment problems that can aid terrorist/extremist recruitment.

A lack of transparency in national security plans, programs, and budgets that allows Gulf think tanks and outside analysts to make a proper contribution, provides independent outside criticism and review, and limits waste, fraud, abuse, and corruption.

That said, it is important to note that there have been many areas of positive force development in the Arab Gulf forces that do give their forces important advantages in war fighting, and that currently shift the balance toward the Arab side to the extent a war escalates to serious levels of combat involving strikes on key bases and civilian targets. These areas are summarized in the following sections on comparative force modernization.

H. Land Force Modernization 

This section highlights Iran’s lack of overall force modernization by highlighting two key aspects of the overall trends in land force modernization: The trends in main battle tank (MBT) and artillery modernization since the beginning of the Iran-Iraq War. These two trends act as summary measures of the ability to use land forces to seize or defend space and conduct maneuver warfare. They have been critical elements of the fighting in the Iran-Iraq War, the first Gulf War in 1990-1991, and the invasion of Iraq in 2003.

However, conventional land forces and heavy weaponry like armor and artillery weapons have not dominated civil fighting and counterinsurgency in Iraq since 2003, the fighting in Syria, or the fighting in Yemen. Iran’s land forces are shaped largely for defense in depth and seem to have limited long-range maneuver capability and uncertain survivability in the face of Arab Gulf and allied airpower. Any major Iranian offensive would how have to maneuver through Iraq to attack any Arab Southern Gulf country or attempt amphibious operations where Iranian training is limited and unrealistic and Iran would have to rely heavily on vulnerable ferries and port facilities to move major forces.

The open-source data available also do not support analysis of what portion of Iran’s MBT systems are operational, nor does it assess Iran’s ability to conduct extended maneuver warfare, provide field repair capability and deal with inoperability, and Iran’s ability to provide any effective long-distance logistic capability to support serious maneuver combat.

I. Air Force Modernization

This section highlights the contrast between the high rate of Arab Gulf modernization and Iran’s reliance on aging, worn, and mediocre US, Chinese, and Soviet air systems, and comparative fixed-wing combat aircraft strength across the region.

Although the IISS reports Iran maintains a total fixed-wing combat aircraft inventory similar to that of Saudi Arabia or Israel, these numbers are highly uncertain and involve largely obsolescent, aging, and mediocre systems. Iran’s readiness and force quality remain major issues. It’s unclear whether and when Iran’s current rate of air modernization, which has focused on domestic production legacy aircraft, can offset the quality and sustainability problems in its aging Western-supplied aircraft and the qualitative superiority of U.S. and Southern Gulf Forces. Iran’s designs have so far been largely testbeds, production has been limited, and unless Iran can buy far more advanced designs from Russia or eventually China, it is unclear when Iran’s air force can rival those of its Gulf neighbors – much less the U.S. – at any point in the near term.

The key issue for the Arab Gulf is not combat aircraft numbers, or quality. It is transforming its purchases into fully capable modern air forces. Here, the Saudi and UAE air force are learning from their war in Yemen, although it is clear that even they still have some ways to go.

J. Land-Based Air/Missile Defense Force Modernization 

At this point in time, Iran is still dependent on surface-to-air missiles whose origin dates to the Shah and Vietnam War era and its own upgrades to its radar sensors and BM/C4 system. For the time being, the Arab Gulf states have a major current advantage in modern land-based air defense missiles, some of which have tactical anti-ballistic missile capabilities. Several Arab Gulf countries have fully modern systems like the newest Patriot surface-to-air and tactical missile defense systems and are making major improvements in their radar sensors and BM/C4.

Several Southern Arab Gulf states – notably Saudi Arabia, Qatar, and the UAE have shown an interest in buying THAAD or standard theater missile defense systems. This is a key priority for the future. The U.S. has deployed cruisers equipped with standard theater missile defense systems to the Gulf in the past, but Iran’s build-up of layered ballistic and missile forces, and UAVs/UCAVs requires an integrated Gulf wide set of layered missile and air defenses.

As noted earlier, however, it is unclear whether and when the Arab Gulf states will buy theater missile defense systems, and whether their national systems will have an effective architecture and be properly integrated. There is an open-ended character to this part of the regional arms race, compounded by uncertainty over the level and timing of Iran’s ability to give its conventionally armed missiles precision strike capability, and whether Iran will deploy some form of CBRN warheads.

However, Iran is taking delivery on a far more modern S-300 system and does have some more modern TOR-M short-range systems for point defense. It also is acquiring far more advanced radars and command and control systems, and claiming to have designed its own modern, mobile surface to air missiles.

It is not clear from open source literature what the real-world capabilities of the new Russian-supplied S-300 missiles, Iranian missiles, and radar sensor, and battle management systems Iran is acquiring will really be, or what upgrades will take place to its existing forces. They could lead to an important shift in the balance, but these uncertainties have been compounded by speculation over the real-world performance of missile and air defense systems like the S300 whose full technical character is not clear from open source data, and where performance specification and data are often speculative and there is no open source data to verify performance by either test and evaluation or combat experience.

K. Naval Force Modernization 

Iran, Iraq, and the Southern Arab Gulf states do maintain large combat ships in their surface fleets. These ships can be used to threaten and intimidate at lower levels of escalation, and they are another key element of the regional military balance. 

The Arab Gulf states have several major advantages in any major conventional naval operations in the Gulf region. Their major surface ships are far more modern, and they are nearly certain to have the support of U.S. naval and air forces.

Such fighting will be joint naval-air-missile operations. The ability of Iran’s aging larger surface vessels to survive under such conditions is doubtful. The U.S. Navy and Air Force, and Southern Arab Gulf air forces should be able to locate and destroy Iran’s large surface forces quickly unless they disperse deep into Indian Ocean.

At the same time, Iran may be able to exploit its land- and air-based anti-ship missiles, submarines, smart mines, and missile/suicide small craft – dispersing and moving forces that are far harder to locate and attack. Iran relies heavily largely on asymmetric naval systems. It possesses the largest inventory of patrol and coastal combatants, submersibles, land-based anti-ship missiles, and mine warfare capabilities.

Iran also continues to steadily improve its capabilities to use such “asymmetric” forces to threaten Gulf shipping and offshore oil facilities, islands, and coastlines. It can also use such forces to harass or threaten larger craft such as tankers and aircraft carriers. Iran has not, however, focused much effort to act as a blue-water navy.

L. Missile Force Modernization 

Land based ballistic and cruise missiles, and long-range artillery rockets, are an area where Iran has a significant lead, although much of the open source data may exaggerate Iran’s missile holdings and ignore their lack of lethality against point targets and critical military and civil facilities. These missile forces can supplement Iran’s air, sea, and land power.

Most importantly, they can at least partly compensate for Iran’s weaknesses in airpower and maneuver forces; and provide a means of leap frogging to more advanced forms of war. Iran has tried to compensate for its failure to modernize many of its major weapons systems by creating the largest and most diverse missile arsenal in the Middle East, with thousands and short and medium-range ballistic and cruise missiles capable of striking targets as far as Israel and southeast Europe.

Missiles have become a central tool of Iranian power projection and anti-access/ area-denial capabilities in the face of U.S. and Southern Arab naval and air power in the region. This helps explain why there is little change that Iran will give up its missile capabilities are part of nay arms control agreement, and is placing a heavy emphasis on improving its missile forces to include systems with precision-guided conventional warheads.

While Iran has not yet tested or deployed a missile capable of striking the United States, it continues to develop longer-range missile technologies under the auspices of its space-launch program. In addition to increasing the quantity of its missile arsenal, Iran has also become a center for missile proliferation, supplying proxies such as Hezbollah and Syria’s al-Assad regime with a steady supply of missiles and rockets, as well as local production capability. Furthermore, Iran is likely supplying Houthi rebel groups with short-range missiles in the ongoing conflict in Yemen.

Anthony H. Cordesman holds the Arleigh A. Burke Chair in Strategy at the Center for Strategic and International Studies in Washington, D.C. He has served as a consultant on Afghanistan to the U.S. Department of Defense and the U.S. Department of State.