The strategic environment in which Israeli leaders and military planners must work is characterized by instability, and recent events have underlined the continuously changing threat environment. These developments include the victory of Hamas, the radical Islamic group, in the first Palestinian legislative elections held in 10 years, and the Iranian effort to acquire nuclear weapons. The close links between Hamas and the Iranian regime highlight the dangers that these events pose for Israel.

A Palestinian government headed by Hamas officials means that Gaza and parts of the West Bank on both sides of Israel’s narrow borders will be controlled by an organization that openly seeks its destruction. In order to prevent a new round of terrorism, Israeli leaders have prepared measures to seal off the areas under Palestinian control, and implement steps towards further disengagement. The first step in this process took place in August 2005, when Israeli civilians and military personnel withdrew entirely from Gaza.

The security impacts of withdrawal remain uncertain, particularly as the launch of short-range rockets from Gaza into Israel has continued at the rate of more than 100 each month. The Egyptian presence along the western border of Gaza has been ineffective, allowing for increased smuggling of missile components and manufacturing tools. Although no Israelis have been killed by the missile attacks since August, this is considered to be largely a matter of luck, and perhaps the impact of Israel Defense Forces (IDF) countermeasures aimed at launch areas.

A few missiles have struck close to Israeli strategic targets, such as the power plant in Ashkelon, which is located a few kilometers from Gaza. These attacks have also highlighted the need for short-range missile interception systems, such as the experimental Nautilus laser system, but these are still some years away. As a result, a major strike that results in deaths or hits a strategic target is likely to trigger an Israeli military return to Gaza.

While Hamas is the source of immediate tactical concerns for Israel, the longer-term strategic threat assessment is increasingly dominated by the Iranian nuclear weapons program. The decision by the International Atomic Energy Agency finding Iran to be in non-compliance with its commitments under the 1970 Non-Proliferation Treaty is an important milestone, and the upcoming discussion in the UN Security Council will mark a further step. The hope is that concerted international action, beginning with sanctions, but perhaps including military action, will prevent Iran from acquiring these weapons.

But Israeli planners are also preparing for the possibility that this last-minute diplomatic effort will fail. The religious leaders in the Iranian regime are not considered to be able to avoid or manage nuclear confrontations, and this perception has been reinforced by recent statements from President Ahmedinijad calling for destruction of Israel. Iran’s direct support for terrorist groups such as Hamas and Hizbollah (which has deployed over 12,000 short-range missiles on Lebanese territory) has increased the potential for a clash.

In this framework, reliance on a form of mutual deterrence, based on the U.S.-Soviet model, would be very problematic. During the Cold War, the explosive element of religion was not part of the mix, and communications between Moscow and Washington were facilitated by embassies and diplomats. These links were very important in defusing the Cuban missile crises in 1962 — Khruschev and Kennedy had some basic idea of the situation on the other side. But no such links are present in the case of Iran and Israel, and the Iranian leadership appears to have no idea of Israel’s red lines and responses to threat.

In the absence of a stable deterrence relationship, and given Iran’s growing capability to launch long-range ballistic missiles, the role of ballistic missile defense has been of increasing importance in Israeli strategy. Israel began to develop the Arrow interceptor in the 1980s, and in 1991, Iraqi use of Scud missiles against Israel accelerated this process. An improved Arrow 2 was developed and has been successful in six of seven tests, including the recent interception of a missile on a trajectory reportedly similar to an Iranian Shahib-3 IRBM. The relatively short distances in the region and the ability to intercept at long ranges means that an Iranian warhead containing WMD could end up being detonated closer to the launch site than to Israel.

The Arrow is the central component of the Homa, or “Wall” BMD system, which also includes the “Green Pine” radar and the “Citron Tree” battle management system. In 1999, the full system was declared operational, and two batteries are currently deployed.

This technological combination with long range tracking and interception capabilities, is considered to be an important element in Israel’s response to a possible Iranian nuclear option. Following the bellicose threats from Tehran, the recent tests and the publicity surrounding them, including a December interception of a Black Sparrow target missile launched by an Israeli Air Force F-15 from the Mediterranean coast, were also designed to send a message. (Since Iran does not recognize Israel, and refuses to hold talks with Israeli officials, the main channels of communications are public declarations and demonstrations of military capability.)

At the same time, Israeli planners are not leaving all of the missile defense eggs in one basket. The deployment of batteries of Patriot interceptors for terminal defense provide an insurance policy in case the Arrow fails to intercept incoming warheads at high altitudes. In a broader sense, the Israeli emphasis on missile defense is best understood as part of a wider deterrence strategy, designed to demonstrate a robust capability to even the most isolated opponents. Offensive capabilities have not been neglected, and perhaps, when taken together, these signals will also lead to greater caution on the part of Iranian leadership .

Gerald M. Steinberg teaches international relations and strategy at Bar Ilan University in Israel.