Israel has announced an ambitious plan to strengthen its position in the global technology race by prioritizing investments in quantum computing and physical artificial intelligence.
The initiative, introduced jointly by the Prime Minister’s Office National AI Directorate and the Finance Ministry’s Accountant General’s Department, is designed to accelerate innovation while building homegrown technological capabilities.
Officials say the strategy marks the beginning of a broader effort to transform government policy into practical projects that can shape the country’s long-term economic and technological future.
Project Nexus to Lead Quantum Computing Development
At the heart of the announcement is a newly introduced initiative known as Project Nexus, which aims to support the development of a locally produced quantum computer.
The government believes building domestic quantum computing infrastructure is essential for maintaining technological independence and strengthening Israel’s competitiveness on the global stage.
Alongside quantum computing, authorities also intend to expand investment in physical AI technologies—systems that allow artificial intelligence to operate in real-world environments rather than remaining limited to digital applications.
National AI Strategy Moves Into Action
The new projects form part of Israel’s wider national AI strategy under Government Decision 4255, which serves as the foundation for the first major initiatives led by the National AI Directorate.
Director of the National AI Directorate, Brig.-Gen. (Res.) Erez Eskel, said the government’s focus has shifted from planning to implementation.
According to him, the objective is to rapidly deploy projects that strengthen Israel’s technological infrastructure while reinforcing areas where the country already enjoys competitive advantages.
Eskel added that establishing sovereign technological capabilities is a key priority as Israel seeks to secure a leadership position in emerging AI technologies over the long term.
Finance Ministry Highlights Public-Private Cooperation
Senior Deputy Accountant General for Innovation and Technology, Evyatar Peretz, emphasized the importance of cooperation between government agencies in turning policy into reality.
He explained that collaboration between the Accountant General’s Department and the National AI Directorate will enable government decisions to be translated into contractual frameworks and infrastructure projects capable of supporting future innovation.
Peretz also said these efforts are intended to reduce barriers for businesses, encourage technological independence, and create conditions that could lead to internationally significant breakthroughs.
Government to Seek Industry Input
As part of the rollout, the government plans to publish a Request for Information (RFI) aimed at gathering insights from the technology sector.
The consultation will assess Israel’s capabilities in developing foundational AI models, identify opportunities for expanding domestic leadership, and explore ways to maximize the country’s strengths in advanced technologies.
Officials believe feedback from industry participants will help shape future investments and guide the next stages of the national AI program.
Quantum Computing Remains a Long-Term National Priority
Israel has invested heavily in quantum computing since 2018, with the goal of joining the world’s leading nations in the field.
Those investments have already produced notable milestones.
In 2024, the country introduced its first domestically developed quantum computer based on superconducting technology.
More recently, Israeli quantum startup Qedma partnered with IBM on research involving a superconducting quantum chip containing 72 physical qubits, with the project aiming to achieve computing performance beyond today’s most powerful supercomputers.
These developments reinforce the government’s decision to keep quantum technology at the center of its innovation agenda.
Physical AI Emerging as the Next Growth Area
Beyond quantum computing, Israel is placing increasing emphasis on physical AI—technology that enables artificial intelligence to interact directly with the physical world.
Applications already include autonomous drones capable of completing missions without human pilots, as well as intelligent systems that optimize industrial energy consumption to improve efficiency and reduce costs.
Industry leaders believe this field could become one of Israel’s next major sources of technological growth.
Industry Sees Opportunity for Future Innovation
Technology executives have welcomed the government’s increased attention to physical AI.
Commit Chairman and President Arik Feingold previously argued that Israel’s strengths in engineering, system integration, and creative problem-solving make it well positioned to lead in deep-tech solutions that combine AI with manufacturing, industrial operations, and field technologies.
He believes greater investment in these areas could not only strengthen Israel’s innovation ecosystem during challenging times but also create new engines of economic growth for years to come.
