EU rejects Baltic request for 500 million euros in drone defence funding

The European Commission has rejected a request from Estonia, Latvia and Lithuania for 500 million euros to develop drone defences, recommending that the countries use loans instead, ERR reports.

Andrius Kubilius, the European commissioner for defence and space, told Lithuania’s public broadcaster LRT on Wednesday that the Commission had responded to the three countries but could not provide the additional funding they sought. He said a new application round for the EU’s Security Action for Europe (SAFE) loan programme would open soon, with 21 billion euros left after its first round.

Kubilius said there were few other opportunities to secure substantial extra funding through EU budget programmes because the current budget period is nearing its end. LRT reported that some support for drone defence might be available through the Integrated Border Management Fund, but the amounts would be far below 500 million euros.

Lithuanian Defence Minister Robertas Kaunas, Estonian Defence Minister Martin Herem and Latvian Defence Minister Raivis Melnis submitted the funding request in September. They proposed combining drone detection, artificial intelligence and interception technology into an air defence system that could serve as a model for other EU countries.

The Baltic states had hoped the Commission would approve the regional funding before the end of the year. Their request cited concerns that drones had entered Estonian, Latvian and Lithuanian airspace during increased Ukrainian long-range attacks on Russia, raising fears that the war could spill across NATO’s border.

Launched last year, SAFE makes up to 150 billion euros in loans available to EU countries for defence procurement. The loans can have repayment terms of up to 45 years, with advance payments of up to 15 percent.

Lithuania can borrow up to 6.375 billion euros through SAFE. The government plans to use the financing for projects including creating an army division, developing the Baltic Defence Line, strengthening air defence and purchasing ammunition and military equipment. In October, Lithuania applied for a 1.06 billion euro loan. If approved, that would bring its total SAFE financing to 1.86 billion euros, including an 800 million euro advance received in June.

Estonia applied last November for a 2.34 billion euro SAFE loan for defence investments. The European Commission approved the request, and the EU Council confirmed on February 17, 2026, that up to 2,343,897,000 euros would be made available. Estonia plans, among other things, to use the loan to strengthen its air defence.