The biggest exporter of unmanned aerial vehicles, which are fast becoming essential to governments worldwide for both military and civilian uses, isn’t the United States, China or other major power. The big winner in this booming global market is Israel. And that creates a lot of geopolitical complications, for the obvious reasons.

Thanks to massive budget cuts and tanking economies, many Western governments, especially in Europe and the United States, are slashing defense spending and eliminating big-ticket weapons systems. Dozens of other countries, throughout Asia, the Middle East and Latin America, are spending more and more these days on their burgeoning militaries. But no matter their economic situation, the one thing they’re all clamoring for is drones. Especially those made in a certain tiny Middle East country surrounded by lots of enemies.

Israel was recently anointed as the world’s largest exporter of the small surveillance planes, according to a major study by the Frost & Sullivan international business consulting firm. The handful of Israeli companies that manufacture the drones earned at least $4.6 billion in sales during the last eight years, Frost & Sullivan said in its report. That tally includes exports of the planes themselves and operating and communications systems and payloads. American defense companies probably manufacture more drones, but they send much of them to the US military and its close allies, Frost & Sullivan’s Eran Flumin told Quartz. Also, US restrictions limit the number of drones that American firms can export.

Israel doesn’t have as strict export curbs. And drone manufacturers like state-owned Israel Aerospace Industries as well as Elbit Systems and Aeronautics Defense Systems have been busy in recent years, Flumin says, expanding their geographic footprint and locking up lucrative new deals. The Frost & Sullivan report did not contain a comparable estimate for American exports for 2005 to 2012. But Flumin and analyst Yakov Baranes said Frost & Sullivan estimates that US companies exported less than $3 billion worth of similar products during that same time period.

Flumin and Baranes also noted that the nature of the drone business is cyclical, and that a recent drop in Israeli exports was more of a fluctuation than a trend. It is also based on a small number of large deals. For example, a major Israeli deal with India for UAV upgrades is worth another $958 million that will be reflected in future figures, they said.

Sure, drones—especially the armed military ones—are often criticized as being morally reprehensible, if not illegal. But the ones Israel exports are arguably one of Israel’s proudest accomplishments on the global commercial stage. More than half of those Israeli exports were to Europe, while a third went to Asia-Pacific countries including India and Azerbaijan. Another 11% went to Latin America, while 3.9% went to the United States and 1.5% to Africa. The top clients: the United Kingdom, India and Brazil. Many countries buy them for surveillance and other non-weaponized uses.

Some analysts predict a quadrupling of demand for military UAVs over the next decade, thanks to their success in wars in Iraq and Afghanistan and Israel’s use of them in many types of operations. Another analysis, issued last month by the Teal Group, predicts that the total worldwide UAV market will more than double over the next decade from current expenditures of $5.2 billion annually to $11.6 billion, totaling just over $89 billion in the next 10 years.

Flumin, who heads Frost & Sullivan’s Israel operations, said Israel is well situated to cement its position as the lead exporter of drones for years to come. That’s in part because Israeli firms are aggressively marketing their drones, for myriad new military and civilian uses, in virtually every corner of the world. The Israeli firms are also leading the way in developing cutting-edge research and development, thanks to longstanding ties to Israel’s military, which has pioneered the use of the vehicles in war zones, conflict areas and for general reconnaissance.

Here’s just one of their newfangled uses under development: a large drone that can swoop in and rescue an injured soldier—or in a civilian application, a wounded hiker stuck in a remote canyon. Other drones will be able to take off vertically, eliminating the need for an airstrip, but without the bulky rotor blades that make helicopters unwieldy in tight quarters.

Israeli firms are also leading the way in developing payloads, or the gear carried within the drones. That includes extremely advanced surveillance cameras and sensors, vastly improved communications capabilities between drones and those operating them and other features that will widely expand the use of drones, especially for civilian uses like law enforcement, search and rescue and agriculture.

“Why Israel is so successful in exporting their drones is that they are optimizing the technology to allow them to be used for many different missions,” Flumin said. “You want to maximize the duration of the mission or the weight of the payload or have a better camera with higher resolution? Everything can be optimized as much as possible.”

But not everyone wants an Israeli drone—especially customers in the Middle East, where there’s a budding arms race over who can buy the most drones the fastest. Because of the growing fear of expanding regional unrest, “every large country in the region understands the need to acquire UAVs,” Frost & Sullivan said in another recent report. That is opening up some opportunities for American firms, which are aggressively lobbying Washington for permission to increase their export capabilities, especially as the Pentagon cuts military spending.

At the IDEX international defense trade show in Abu Dhabi in February, the United Arab Emirates announced it was buying an unspecified number of Predator surveillance drones from US firm General Atomics in a deal worth $196.57 million. Frost & Sullivan cited that as evidence that Washington was easing its stances on such exports. Gulf countries are looking for other manufacturers too, and China, Turkey and even Pakistan are working overtime to create drones that they can sell on the international market.

Meanwhile, Brazil and a host of other countries are developing their own drones to monitor borders and vast swaths of farmland. And three of Europe’s top military contractors last month urged the region’s governments to establish a joint program to develop drones of their own, to reduce reliance on Israeli and US manufacturers.