New versions of the Arrow-2 interceptor planned for deployment early next year will enhance Israel’s ability to defend against current as well as future threats posed by the Iranian Shihab-3 ballistic missile, defense and industry sources here say.

In interviews here, program officials said the successful Dec. 2 test of the new Block 3 interceptor demonstrates the ability of the Arrow weapon system to locate, target and destroy the type of increasingly sophisticated maneuvering missiles expected to become operational in Iran around the turn of the decade.

“Our improvement program is aimed at responding to emerging threats in this region. … Iran is developing several upgraded Shihab versions that could come on line at the end of this decade or the beginning of the next. Our job is to deliver into the hands of the Israel Air Force everything it needs to counter these threats,” said Arieh Herzog, director of the Israel Missile Defense Organization (IMDO).

Herzog insisted that Block 2 versions of the Arrow interceptor now deployed with the Israel Air Force “can handle all current Shihab threats” and all known versions of Scud missiles deployed in the region. The new Block 3 interceptors are designed to defend against larger quantities of increasingly capable Shihab missiles that potentially could be modified to deliver non-conventional warheads, he said.

“Arrow is designed to kill all types of missile threats in our sector, including those carrying non-conventional warheads. We know we already are capable of intercepting existing missiles, and Block 3 expands our operating envelope and elevates our chances for success against current and future threats,” Herzog said.

He said the Dec. 2 test aimed at validating software changes and new avionics inherent in the new Block 3 interceptor as well as the overall reliability of Israel’s entire national missile defense network. Herzog noted that this was the final test of the Block 3 interceptor before it becomes operational with the Israel Air Force early next year. “The test was designed according to an extreme threat scenario that challenges the interceptor and the entire Arrow weapon system to perform at the outer edges of the operational envelope,” Herzog said.

While Herzog declined to elaborate on the specific type of threat simulated by Israel’s Black Sparrow air-launched target missile, his predecessor at IMDO said the Dec. 2 test closely replicated maneuvering flight paths of the Iranian Shihab-3. “The Iranian missile flies in a very complicated trajectory that is difficult to intercept. It essentially behaves like a maneuvering target,” said Uzi Rubin, Israel’s founding IMDO director who now consults on missile defense and strategic affairs.

Rubin said the Arrow’s direct-hit intercept in the test “proves to all those who doubted that we can cope with whatever the fanatical regime in Iran can launch at us.”

Despite Israel’s commitment to continually upgrade its ballistic missile defenses, the nation’s top military officer insisted that other, more active means may be needed to prevent an Iranian attack. “We will continue to invest in modifying the Arrow. … Such a system is essential for us. But defense in and of itself is not enough. Defense is the last echelon when everything else fails. And we cannot allow ourselves to rely only on a strong defending system,” said Lt. Gen. Dan Halutz, chief of staff of the Israel Defense Forces.

Halutz cited recent calls by Iranian President Mahmoud Ahmadinejad to wipe Israel off the map as evidence of Tehran’s “fanatical agenda.” Speaking at a Tel Aviv University seminar in late November, Halutz said, “The combination of an irrational regime and the capability to deliver weapons of mass destruction is a threat to our existence.”

Expanding on the Iranian threat in a Dec. 5 briefing to reporters here, Halutz said diplomatic attempts by the United Nations and leaders in the international community to halt Iran’s nuclear technology drive are unlikely to succeed. On the contrary, Halutz suggested that the focus on diplomatic means of prevention merely serve to buy time for Tehran, which he said is determined to acquire a nuclear weapons capability.

“The fact that no one has yet succeeded in forcing them or convincing them to stop their nuclear project is allowing Iran to proceed, step by step, to a point where it will be irreversible. … I don’t think political pressure will bear fruit. The Iranians are manipulating all these pressures and succeeding, for the time being,” Halutz said. “No doubt that from Israel’s point of view, this is unacceptable. But it is a problem for all countries that fall under the footprint of Iranian missiles to be developed and those that exist already.”

Halutz declined to elaborate on possible Israeli responses to the Iranian nuclear threat, and insisted that specific military options are not yet being considered. “There is a way to stop anything. But practically, it’s not easy,” he conceded.

Jointly developed by the United States and Israel, the Arrow is designed to fly more than eight times the speed of sound — about 2 kilometers per second — to intercept incoming ballistic missiles at altitudes of more than 100 kilometers. The system’s Green Pine phased array fire control radar is capable of detecting and tracking targets more than 600 kilometers away.

Since the Israel Air Force declared the system operational in late 2000, the Arrow-2 has scored six hits in seven intercept tests. A navigation-system glitch caused an Arrow-2 to miss its target in August 2004 in the second of two such tests off the California coast. The first, in July 2004, resulted in a successful intercept. The Green Pine radar system was shipped to the U.S. Naval Test Range at Pt. Magu, Calif., for those tests.

The unsuccessful intercept test ” was the first time we went up against a target in which the warhead separated from the body of the missile,” said Boaz Levy, Arrow program manager at the MLM Division of Israel Aircraft Industries Ltd., prime contractor for the program. “And even though we didn’t score an intercept, we demonstrated the system’s ability to discriminate among separating objects and to launch the interceptor at the correct target. ”

In a Nov. 27 briefing here, Herzog estimated Arrow program costs at $2.4 billion, more than half of which was funded directly by the United States. Israeli-funded system elements include the Green Pine fire control radar by IAI’s Elta Systems Ltd.; the Citron Tree battle management center by Tadiran Electronic Systems Ltd.; and the Hazlenut Tree launcher control center by IAI’s MLM Division.

Under an agreement between IAI and Chicago-based Boeing Co., nearly 50 percent of Arrow-2 missile components and major subsystems are produced at the U.S. firm’s Huntsville, Ala., facility and then shipped to Israel for final assembly. In October, the first product of joint U.S.-Israel production — missile No. 325 — was completed and readied for delivery to the Israel Air Force.