Serbia and Israel will open a joint drone manufacturing factory near Belgrade, the Israeli newspaper Haaretz reported.

The factory will be located in the industrial zone of Šimanovci, approximately 30 kilometers west of Belgrade. It will produce two types of unmanned aerial vehicles:

Short-range armed drones capable of carrying heavy payloads and long-range advanced drones designed to operate at altitudes of up to 6 kilometers. The new drones will reportedly surpass the capabilities of the Serbian Pegasus model.

The partner in the project is the Israeli defense giant Elbit Systems with a 51 percent ownership stake, while the Serbian state defense manufacturer SDPR holds the remainder.

Serbian arms exports to Israel grew 42-fold in two years, reaching 114 million euros in 2025. Elbit signed contracts with Serbia worth 335 million dollars and subsequently an additional 1.6 billion dollars for artillery systems, drones, and electronic warfare.