The Iranian "space programme" dictates the budget Israel has to invest in its anti-ballistic missile defence system. In recent months, the Iranians have increased their spending on the programme and Israel had no choice but to follow with help from the USA.
Iran is investing huge sums of money in a space programme but intelligence sources say that the technology involved will enable the country to develop long range ballistic missiles that could reach Europe.
In recent months the Iranians uncovered a huge launcher, the Safir 1-B, and experts say that it will enable them to launch intercontinental missiles in the future.
Tal Inbar, a senior researcher in the Fisher Institute for Space and Aviation in Israel, says that the Iranians have embarked on a road that will lead to a capability to launch intercontinental ballistic missile (ICBM) in the not distant future.
The Iranians displayed four new domestically produced satellites as part of their space programme. The satellites are dubbed Fajr, Rasad, Zafar and Amir Kabir-1.
The Israeli sources say that Iran is making a huge effort to launch advanced imaging satellites.
The Iranian space programme is being conducted in very modern facilities that include a test centre, that according to the Israeli experts can accommodate a 35-40m-long missile.
While the Iranians are pouring money into what they call space programme, Israel is continuing with the development of the Arrow-3 advanced anti ballistic missile system and recently has conducted an intercept test in a US range with an improved block of the operational Arrow-2 .
This race is swallowing huge sums of money and at this stage shows no signs of even slowing down.