Israel Seeks More U.S. Aid, Denies Link to Restraint

Finance Minister Yitzhak Modai said today that Israel will ask for at least $13 billion in extra U.S. aid over five years but denied the request was linked to Israeli restraint in the Persian Gulf War.

Modai said he did not make any specific aid requests during a meeting with visiting U.S. Deputy Secretary of State Lawrence S. Eagleburger, but he was optimistic Washington would help the Jewish state.

Israel currently receives $3 billion a year in U.S. economic and military aid.

The Jewish state will ask for at least $3 billion more to meet the costs of the Persian Gulf War, including extra military spending, damage from Iraqi missile attacks and losses to the economy, particularly tourism, Modai told reporters. These costs will mount as the war goes on, he added.

Israel will also seek a five-year, $10-billion U.S. aid package of grants and loans and investment guarantees to help with an influx of Soviet Jewish immigrants.

“Today we did not raise formal requests for aid, only indications along two paths . . . costs stemming from the war are on the scale of $3 billion,” Modai said, adding that these were estimated military costs through mid-February.

“We also raised a request for general economic aid tied to the absorption of immigrants from the Soviet Union,” he said.

Israel will need $20 billion in foreign funds to absorb 1 million Soviet Jews expected to arrive by the end of 1992, he said.

“If the United States can give us the first half--and I say not in cash, but by means of a package--then we will succeed in raising the equivalent sum from other sources,” Modai added.

Asked if U.S. aid depended on an Israeli pledge to keep out of the Gulf War, Modai said: “I can say with certainty and decisiveness that no such promise was given, not concerning this aid or any other aid.”

Modai said Israel still had not received a $400-million loan guarantee for immigrant housing which Washington promised long ago but delayed over political differences with the Jewish state.

Adam Garfinkel, a political analyst in Washington, said the loan guarantees and other items could be given by the United States as rewards “for doing something or not doing something” in the war.

Modai gave a breakdown of estimated direct and indirect costs of the Gulf War, totaling $2.96 billion:

* $400 million in direct military expenses;

* $30 million in damage from at least 11 Scud missiles that struck Israeli cities;

* $1 billion in lost output expected during the first month of war due to disruptions, including a four-day shutdown at the start of the fighting;

* $1 billion in lost tourism revenues and greater energy costs;

* $180 million in extra insurance costs;

* $100 million in lost income from air and sea transport services;

* $250 million in lost export orders.