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Saudi grant programme to develop local defence sector

military helicopters Unsplash/Juli Kosolapova
Saudi Arabia wants to channel 50 percent of its military spending to domestic companies
  • $177m of grants
  • Grants to go towards research and design
  • Defence spend to be $86bn in 2028

Two Saudi government entities have launched a four-year programme of grants worth 664 million riyals ($177 million) to support the development of a local defence sector, part of plans to diversify its arms industry sources by 2030.  

The General Authority for Defense Development and Public Investment Fund-owned Saudi Arabian Military Industries (Sami) launched the initiative on October 10.

It will provide defence authority grants for “research in targeted areas and building special facilities to support related technology development”, the Saudi Press Agency said. 

Sami will form partnerships with various national development centres and Saudi universities to help “design and eventually industrialize the outcomes of their defense development activities and meet military and security entities’ needs”, Spa said. 

Sami was established by PIF in 2017 as part of government plans to channel 50 percent of military spending to Saudi companies by 2030 in a bid to reduce its massive arms bill. 

Sami said last year it would set up one of the world’s biggest munitions factories, including the production of a Saudi-made drone. 

Saudi Arabia was ranked fifth in the table of world military spenders in 2022, behind the United States, China, Russia and India.

Defence spending will grow 4.5 percent a year to $86 billion in 2028, from $65 billion in 2022 and a defence budget of $69 billion for 2023, defence analysts GlobalData said in a report last month

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