By Steven Scheer

JERUSALEM (Reuters) -Israel will raise defence spending by 42 billion shekels ($12.5 billion) in 2025 and 2026, the finance and defence ministries said on Thursday, citing the country's security challenges.

The budget agreement will allow the Defence Ministry to "advance urgent and essential procurement deals critical to national security," the ministries said in a statement.

Finance Minister Bezalel Smotrich said the new defence budget "fully covers the intense fighting in Gaza, alongside comprehensive security preparations for all threats — from the south, the north, and more distant arenas."

Israel's military costs have surged since it launched its military offensive on Gaza following the deadly attacks by Hamas........

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