The reported sales to Muslim Pakistan, in particular, carry "the potential to develop into a really messy diplomatic quagmire" with India, Pakistan's archrival and one of Israel's biggest customers for weapons systems and other military equipment, Indian analyst Alvite Singh Ningthoujam warned in a commentary published by the Jerusalem Post.
"Even though present-day India is concentrating on grooming its indigenous arms production policy, the bulk of its military equipment is still imported," he noted. "This is where Israel has carved its own niche.
"But if clandestine military sales to Pakistan exist and are to continue, then for obvious reasons, India will not approve," said Ningthoujam, who served as Fellow at the Begin-Sadat Center of Israel's Bar-Ilan University (2010-11).
India is the world's biggest arms importer and accounts for 10 percent of global arms imports. Its total military expenditure in 2011 -- excluding nuclear weapons -- was $44.2 billion, the Stockholm International Peace Research Institute said.
A British report released June 14 by the British Department of Business, Innovation and Skills, which oversees security exports, said Israeli arms, all incorporating British components, were exported to Pakistan, Algeria, Egypt, the United Arab Emirates and Morocco from 2008 to 2012.
The exports included radar systems, electronic warfare suites, fighter jet components and cockpit head-up displays.
Israel and Pakistan both denied Islamabad bought military equipment from Israel. Egypt, which signed a landmark peace treaty with Israel in 1979, is the only country listed by the U.K. agency with which Israel has diplomatic relations.
Israel's defense sector is overseen by the Defense Ministry, which over the years has clearly had considerable latitude in terms of arms sales, often to unsavory or dubious Third World regimes and organizations that are publicly shunned by the world's leading defense establishments.
These often secret, and sometimes shady, dealings were intended to provide Israel, ringed by hostile Arab states for much of its existence since 1948, with friendly powers to break its isolation and develop intelligence alliances.
"Historically," Ningthoujam observed, "Israel's establishment of closer ties with other countries has often been accompanied or facilitated by military relations.
"Arms sales and other forms of security relations occupied a prominent position in Israel's relations with Iran under the shah, South Africa during the apartheid era, Taiwan, Latin America, Turkey and India," with whom relations were established in 1992.
For India, a major buyer of Israeli weapons and other advanced defense systems, the assertion that the Jewish state is selling military equipment to Pakistan could have immense diplomatic and economic repercussions.
New Delhi has made no public comment about the British allegations. But Ningthoujam observed that if the report "is proved to be true, it could damage Indian-Israeli defense ties" that have produced Israel arms deals worth $10 billion over the last decade and could jeopardize future sales of the same magnitude.
New Delhi plans to spend as much as $150 billion at home and abroad in the next decade to upgrade its armed forces.
India's government and military chiefs have urged an accelerated drive to build up a national defense industry to reduce military imports and is pressing key suppliers like Israel to participate in joint ventures if they want a piece of India's defense business.
Over the years, Israel has racked up some major arms deals with New Delhi.
These include the 2004 sale of three Phalcon early warning aircraft built by state-owned Israel Aerospace Industries for $1.1 billion and Rafael Advanced Defense Systems' 2009 contract for 18 Spyder surface-to-air missile systems worth $1 billion.
India wants to buy Rafael's famed Iron Dome anti-missile system, which has been tested in combat against short-range Palestinian rockets and scored a kill rate of 85 percent of all missiles engaged.
The Indians have also been eyeing the Arrow-2 anti-ballistic missile system built by IAI and U.S. aerospace manufacturer Boeing Co.
New Delhi favors a joint production agreement on Iron Dome between India's Defense Research and Development Organization and Rafael and other Israeli contractors.