The United Arab Emirates, an economic giant and rising military power in the Persian Gulf, is reported to have discreet ties with private security companies in Israel to protect its oil fields and borders.

The Intelligence Online Web site reports that the country's Critical National Infrastructure Authority has had business dealings with several Israeli firms since it was established in 2007, even though the emirates has no diplomatic relations with the Jewish state.

"Trade between the two countries, principally in the area of security, amounted to nearly $300 million last year," Intelligence Online reported Jan. 12.

CNIA is based in Abu Dhabi, the main oil-rich emirate in the federation. It's the capital of the United Arab Emirates and handles the federation's military and security affairs.

"The Israeli businessman most active in Abu Dhabi is Mati Kochavi, owner of the Swiss-registered company AGT, which sold the emirates surveillance cameras, electronic fences and sensors to monitor strategic infrastructure and oil fields."

That contract was reportedly worth $800 million.

But these ties may be threatened because of a dispute between Abu Dhabi and Israel's Aeronautics Defense Systems, founded in 1997 and which has been involved in several international arms scandals in recent years.

This centers on a 2011 deal between CNIA and ADS under which the Israeli outfit would sell the infrastructure authority combat-capable unmanned aerial vehicles like those used against Palestinian militants in the Gaza Strip.

But the deal turned sour when it was found that ADS had failed to secure approval from the Israeli Defense Ministry's military sales division, known as SIBAT, to export the UAVs to an Arab state. The dispute has "infuriated the emirate, which had paid a $70 million advance on the contract," Intelligence Online reported.

"Fearing irreparable consequences for its relations with Abu Dhabi, the Israeli Defense Ministry is trying to come up with a solution."

Intelligence Online said Israel's ImageSat satellite operator has had a Satellite Operating Partner contract since 2006 with the emirates' Space Reconnaissance Center to provide it with program access to the Israeli firm's Eros B commercial satellite launched in April 2006.

The emirates is developing its own satellite program, with an eye to acquiring surveillance craft capable of spying on gulf rival Iran.

ADS is headed by Avi Leumi, a former officer in Israel's Military Intelligence who has secured contracts with Russia and Azerbaijan, a Muslim state and former Soviet republic on Iran's northern border where Israel has established deep intelligence and military ties over the last decade.

Intelligence Online reported several defense and security concerns such as France's CS Systems, which supplied the emirates' military command and control system, and the European Aeronautic Defense and Space Co. "are hoping to benefit from the Israeli group's woes."

EADS, with headquarters in Leiden, the Netherlands, comprises Aerospatiale-Matra of France, DaimlerChrysler Aerospace of Germany and Construcciones Aeronauticas of Spain.

The emirates' judicious ties to Israel's security industry, which operates in close proximity to the country's secretive security establishment, have emerged despite decades of Arab-Israeli hostility.

Kovachi's AGT, like many of Israel's private security companies, employs retired military generals and other senior officers who have access to the Defense Ministry. Among Kovachi's consultants is Maj. Gen. Amos Malka, who headed Israel's Military Intelligence from 1998-2001.

Since the 1993-94 Oslo peace accords between Israel and the Palestine Liberation Organization, Israel has established discreet diplomatic and trade ties with several gulf monarchies.

They have also found a common adversary in Iran, whose expansionist policies and contentious nuclear program are viewed as a major threat by the Arab states in the gulf and by Israel.

The Jewish state's circumspect ties to the emirates were badly jolted when Mahmoud al-Mabhouh, a senior leader of the Hamas Palestinian groups in the Gaza Strip, was assassinated in Dubai, part of the United Arab Emirates, Jan. 19, 2010. Dubai police blamed Israel for the killing.

Bahrain, Oman and Qatar have all been reported in recent years to have conducted secret talks with Israel. Indeed, their intelligence chiefs have reportedly met several times to discuss the Iranian threat.

Last May, Israeli Prime Minister Binyamin Netanyahu reportedly met secretly with Qatar's premier, Sheik Hamas bin Jassim bin Jabor al-Thani, in London and discussed the possibility of buying Qatari natural gas.