The package represents a major commitment to Israel’s security in the waning months of Obama’s presidency after years of fractious relations with Netanyahu over issues like the Iran nuclear agreement. Netanyahu agreed to several concessions to cement the deal rather than gamble on winning better terms from the next president.

The State Department scheduled a ceremony to formally announce the pact, which will be signed by Jacob Nagel, the acting national security adviser to Prime Minister Benjamin Netanyahu of Israel, and Thomas A. Shannon Jr., the undersecretary of state for political affairs. Susan E. Rice, President Obama’s national security adviser who handled negotiations, plans to be on hand.

JERUSALEM — The United States has finalized a $38 billion package of military aid for Israel over the next 10 years, the largest of its kind ever, and the two allies plan to sign the agreement Wednesday, US and Israeli officials said.

The package will provide an average of $3.8 billion a year over the next decade to Israel, already the largest recipient of US aid, including financing for missile defense systems that defend against rockets fired by groups like Hezbollah and Hamas. Under a previous 10-year agreement that expires in 2018, the United States provides about $3 billion a year, but lately Congress has added up to $500 million a year for missile defense.


“The United States has invested significantly in many of Israel’s most effective defenses against terrorist threats,” Daniel B. Shapiro, the US ambassador to Israel, said in a speech this week. He cited the Iron Dome antimissile system and the delivery by the end of this year of the first F-35 Joint Strike Fighter.

Looking ahead to the next decade, Netanyahu initially sought as much as $45 billion, but Obama refused to go that high. Money for missile defense is included in the package, and the two sides agreed not to seek additional funds from Congress in the next decade unless both agree, such as in case of a war.


The new deal will also phase out a special provision that allowed Israel to use about a quarter of the money to buy Israeli arms, an exception once intended to strengthen the small state’s defense industry. Now, with Israel a robust arms exporter competing with US firms, it will have to use the US money to buy US military systems, just as other aid recipients are required to do.

“The most important thing about this is the strategic message,” said Ilan Goldenberg, director of the Middle East Security Program at the Center for a New American Security. “The fact that Obama and Netanyahu are able to get this done even when they don’t agree on a lot of things and they don’t have a very good personal relationship is a very strong signal that this is a vital alliance and each side recognizes it transcends politics and personalities.”

Dennis Ross, a former Middle East adviser to Obama and other presidents, noted that the agreement follows one negotiated by President George W. Bush. “If nothing else, it shows the basic American approach to Israel is, in fact, bipartisan,” said Ross, author of “Doomed to Succeed,” a history of Israeli-American relations.

But the completion of the deal after nearly a year of discussions comes against the background of continuing friction between the two nations’ leaders. Just in recent days, the Obama administration publicly chastised the prime minister for a provocative video in which he accused Palestinian leaders of favoring “ethnic cleansing” by demanding a Jew-free Palestinian state through opposing Israeli settlements in the West Bank. Palestinians said he twisted reality.


The aid package hardly signals the end of such tension. Obama’s foreign policy team is debating whether he should make a final effort after the November election to lay out terms of a possible peace agreement between Israelis and Palestinians. Such a move could come in a presidential speech or potentially, though less likely, a resolution at the UN Security Council.

The idea would be to break out of what US officials consider the trap of waiting for one or both of the parties to step forward. While Obama’s statement would hardly settle the issue, some advisers argue it might break the logjam or at least lay down a marker. Other advisers doubt it would be worth Obama’s political capital in the lame-duck period after the election and worry it would be unwelcome if Hillary Clinton wins.