Current US military aid to Israel stands at more than $3 billion a year. Israel will have to increase its defense expenses in the long run despite there being no immediate threat, Barak said.
He believes it is too early to tell whether Iran is taking advantage of regional unrest to expand its influence. Barak also noted that prior to the wave of Arab protests "You could see Arab leaders starting to hedge their bets on who is the strongest leader here, Iran or the United States."
A 'daring' peace offer?The defense minister did not question Egypt's commitment to the peace treaty "for the time being" and noted he had already spoken to his Egyptian counterpart, Field Marshal Mohamed Hussein Tantawi - the newly appointed commander-in-chief of the Egyptian Armed Forces.
In the interview Barak said that according to a senior Egyptian official, whose name he did not mention, Israel should expect "the cold shoulder" from Cairo if it fails to advance the Palestinian peace process.
"He told me: 'We're going to have a really open election....Civic parties will hire advisers from the US and Europe and find immediately that what can bring them voters is hostility to America and Israel."
At a time when the US government continues to pressure Israel and the Palestinians to renew their talks, Barak knows one cannot request military aid without making a "daring" peace offer. The defense minister said that current discussions among Israeli officials revolve around this issue, adding that Netanyahu is expected to present his initiative soon.
The proposal will most likely include, according to Barak, a Palestinian state with provisional borders – prior to talks on other core issues.
The Palestinians have already announced they will reject such an offer, but Barak believes Israel and the US must promise Palestinian President Mahmoud Abbas that a full-fledged agreement is on the agenda.