Gulf Contracts, IRGC Budgets Reshape Regional Power
Gulf States' $36.6 Billion US FMS and LIG Nex1 Deal
In the first quarter of 2026, the United States approved over $36.6 billion in potential Foreign Military Sales for the Gulf region, including significant amounts for Saudi Arabia, the UAE, and Kuwait. Strategy& (PwC) observed that Gulf allies are pursuing a broader strategy to establish significant non-US defense procurement contracts by value and volume, driven by direct foreign purchases and aggressive indigenous manufacturing initiatives. Saudi Arabia committed $3.2 billion to South Korea's LIG Nex1 in February 2024 for ten KM-SAM Block II medium-range air defense batteries, according to Forecast International and the Quincy Institute for Responsible Statecraft. The Quincy Institute for Responsible Statecraft and Strategy& (PwC) documented Saudi Arabia's Vision 2030, which aims to manufacture half of its own defense equipment by 2030. The kingdom is also in active procurement talks for Sino-Pakistani JF-17 fighter planes, the Quincy Institute for Responsible Statecraft added.
With a defense budget of approximately $27.2 billion in 2026, the United Arab Emirates (UAE) aggressively invests in indigenous capabilities, Yahoo Finance and Strategy& (PwC) found. Yahoo Finance and Strategy& (PwC) further detailed that local companies secured nearly 60% of deals at the 2017 IDEX exhibition, representing over $2.7 billion in value, and dominated 94% of maintenance, repair, and overhaul (MRO) operations. Breaking Defense documented the UAE's development of local platforms, such as the Calidus B-250 aircraft for counter-unmanned aerial systems (C-UAS).
Qatar's $7 Billion French Fighter Deal and 54% US Imports
The Quincy Institute for Responsible Statecraft and Nordic Defence Review highlighted Qatar's significant high-value non-US contracts, which include a $7 billion purchase of French fighter planes and recent moves to acquire British Typhoon jets. Kuwait, for example, signed a $1.02 billion contract for the NASAMS air defense system, as reported by the Arab Gulf States Institute in Washington (AGSI). Breaking Defense and Nordic Defence Review observed that while Gulf states are diversifying to mitigate strained US supply chains and build self-sufficiency, they continue to anchor their inventories with American platforms. Reuters reported that despite these diversification efforts, the United States accounted for 54% of Middle East arms imports between 2021 and 2025. This multi-vendor strategy enhances supply chain resilience and offers strategic advantages by reducing reliance on a single supplier, according to analyses from the Quincy Institute for Responsible Statecraft, Yahoo Finance, Strategy& (PwC), Breaking Defense, and Nordic Defence Review.
22% of Iranian Ministers are Clerical Sons
According to Clingendael, the Islamic Revolutionary Guard Corps (IRGC) and its affiliated revolutionary-religious foundations (bonyads), forming a "military-bonyad complex," have gained measurable control over resource allocation during the conflict. A CUNY academic paper and Reuters revealed that 22% of Iranian ministers are sons of clerical personalities, and 15% of elites have familial ties, enabling these factions to divert resources through informal networks and managerial roles in state-owned enterprises. While the IRGC's shadow revenues and budget surges outpace formal clerical allocations, a CUNY academic paper and Reuters also reported that competing clerical and administrative factions consolidate power through nepotistic appointments. This suggests a dual system of resource control, where the IRGC dominates direct economic capture and military-industrial output, while clerical families leverage formal budgets and administrative positions. From 2024 to mid-2026, the exponential budget surges and shadow networks indicate a sustained structural takeover by these factions rather than a temporary, conflict-driven reallocation, a CUNY academic paper and Reuters concluded.
Gulf Allies' Resilient Defense and IRGC Control
The clear consolidation of regional power, marked by the sustained structural takeover by the IRGC and its affiliated bonyads alongside a strategic diversification of defense capabilities, will continue to reshape regional security for years to come. This dual dynamic implies a future Middle East less susceptible to single-source supply chain disruptions and more defined by entrenched, militarized economies.
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