Insider Brief
- Israel and the United States are planning a $200 million joint quantum and AI fund, with possible backing from Gulf states, to strengthen regional partnerships and curb Chinese influence in advanced technology.
- According to Globes and reported by the Jerusalem Post, the initiative will support U.S.-Israeli quantum ventures from 2026 to 2030 and may draw contributions from the UAE and Saudi Arabia, leveraging their energy infrastructure and data capabilities.
- The fund aims to boost Israel’s global tech standing, modeled after existing bilateral R&D foundations, while aligning the Abraham Accords nations and Central Asia in a strategic tech alliance centered on quantum innovation.
Israel and the United States are preparing to launch a $200 million joint fund to support quantum and artificial intelligence (AI) projects, a move that could draw support from Gulf states and counter China’s influence in next-generation technologies.
The plan, first reported by Globes and covered in the Jerusalem Post, proposes $100 million in public investment from Israel and the U.S. over a four-year period starting in 2026. Additional contributions may come from the United Arab Emirates and Saudi Arabia, two countries with growing technological ambitions and the energy infrastructure to support power-hungry quantum research.
The initiative is backed by Israel’s Institute for National Security Studies (INSS) and promoted by AIQ-Lab, a policy lab focused on AI and quantum sovereignty. According to the Jerusalem Post, the fund’s strategic goal is to harness Israel’s technology leadership while building deeper partnerships across the Middle East and reasserting U.S. global influence in the face of expanding Chinese efforts in quantum science.
If finalized, the project would operate bi-nationally from offices in Tel Aviv and Arlington County, Virginia, according to reports. It may also tap funds from the U.S. CHIPS Act, which allocates billions for advanced computing and semiconductor development.
The initiative reflects Israel’s strong quantum ecosystem.
The Quantum Insider’s Intelligence Platform indicates that Israel has attracted significant investment in the quantum sector, with total funding amounting to approximately $667 million. The nation has also established 79 approved partnerships within the quantum domain The platform also suggests the nation has developed leadership status quantum software solutions — which are essential for advancing quantum computing capabilities globally — with many entities in Israel’s quantum sector primarily classified under “Software.”
Globes also highlighted Israel’s efforts in the quantum industry. Dr. Smadar Itzkovich told Globes: “Israel ranks among the five leading countries in the global quantum industry, and its ‘density’ of experts in Israel is six times higher than in the US. The US understands this and recognizes that there is planning for such legislation ahead of the US midterm elections and the general elections in Israel next year.”
A Strategic Alignment of Allies
The proposed fund would be modeled on prior Israel-U.S. joint research programs, including the Binational Science Foundation and the Binational Industrial Research and Development Foundation. According to Globes, this format allows Israeli and American quantum start-ups to co-apply for funding. One example cited is a potential joint venture between Israel’s Quantum Source, which builds photonic quantum hardware, and U.S.-based PsiQuantum, which is attempting to build the world’s largest photonic quantum computer.
The fund is also seen as a vehicle for broader geopolitical alignment. According to the Jerusalem Post, securing investment from Gulf states would strengthen the Abraham Accords — the diplomatic agreements that normalized relations between Israel and several Arab nations — while reinforcing U.S.-led tech alliances in the Middle East.
By including Saudi Arabia, the UAE, and eventually Central Asian countries like Kazakhstan and Uzbekistan, the initiative could evolve into a pan-regional tech development zone, anchored by energy-rich nations and connected through shared research and infrastructure projects.
China in the Crosshairs
According to Globes, the fund is also designed as a counterweight to Chinese technological expansion. In recent years, China has invested heavily in quantum research, establishing national labs and acquiring foreign start-ups. The United States, in response, has tightened export controls and sought to reduce Chinese access to critical technologies.
The Jerusalem Post notes that for Israel to qualify for deeper collaboration with the U.S. under this plan, it would likely need to pass stricter export control and intellectual property protection laws, particularly those limiting cooperation with China. Previous Israeli governments had prioritized these updates, but the current administration has not yet acted.
The urgency behind the proposal has increased following Israel’s exclusion from a recent AI research pact between the U.S., Saudi Arabia, and the UAE. According to Globes, this exclusion has fueled concerns in Jerusalem that Israel risks being sidelined in the global race for AI and quantum leadership, especially as Gulf states rapidly scale their capabilities through foreign partnerships.
Hadas Lorber, a former senior official in the National Security Council, who leads the INSS project focused on strengthening Israel-US relations, told Globes: “We are now in the perfect storm in which Trump’s US can give Israel partnerships that it may not have been open to in the past – there is a favorable Congress, and regional momentum after the Iran operation, in which the Israeli advantage is clearly visible in the Middle East. The US also now has an interest in embracing the countries of the region to prevent their influence from shifting to the Chinese side of the map.”
The Business of Diplomacy
The fund’s diplomatic design is reminiscent of earlier efforts by the Trump administration to use business ties as the foundation for regional stability. According to the Guardian and cited by the Jerusalem Post, the U.S. and UAE recently agreed to build the world’s largest AI campus outside America, a deal that dovetails with former President Trump’s strategy of leveraging economic cooperation to reshape alliances.
In May, for example, the White House, Quantinuum and Al Rabban Capital finalized up to a $1 billion joint venture that will be used to invest in quantum technologies and workforce development in the United States and Qatar, one of the largest quantum deals to date.
Israel’s inclusion in these AI and quantum efforts is critical. Experts believe the country’s edge comes from a mix of academic research, military-driven innovation and a robust startup culture.
However, scaling quantum technologies from lab to real-world application demands infrastructure far beyond Israel’s domestic capacity. Gulf countries — particularly the UAE and Saudi Arabia — have the data centers, electricity generation, and sovereign wealth funds to support such growth, according to the reports. As Dr. Ariel Sobelman of the INSS emphasized in Globes, these partnerships offer complementary strengths: Israeli know-how, U.S. capital, and Gulf energy.
What Comes Next
The next step is legislative. The INSS proposal envisions new legal frameworks in both Israel and the U.S. to enable long-term funding of commercial quantum collaborations. If approved, the fund could begin operations by 2026, backing joint R&D projects and helping build regional research hubs.
Beyond the business and research implications, the plan reflects a deeper geopolitical calculation. According to the Jerusalem Post, this is a play to secure influence over the technologies that could define future military, economic and intelligence power and to do so with allies who can collectively challenge China’s ambitions in these areas.
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