Israel's defense budget for 2026 has been set at NIS 112 billion, following an agreement between the defense and finance ministers. The finance minister had initially pushed for a smaller budget, citing concerns over spending efficiency after two years of increased war-related costs. Defense officials warned that a reduced budget could delay important deals. The final agreement assumes an average of 40,000 reservists will be called up in 2026, a significant decrease from the peak numbers during recent conflict. Additionally, a separate package of funding will be allocated for security measures in the West Bank and along the Jordanian border.