US approves billion-dollar arms deal with Australia

The US government on Monday approved a deal for US firms to sell its close ally Australia $1.22 billion in air-to-air missiles and support equipment.

The main contractor for the major shipment will be Arizona-based arms giant Raytheon, which produces the AIM-120D medium-range missile.

Up to 450 of the weapons will arm the Royal Australian Air Force's (RAAF) FA-18 Hornet and F-35 Lightning fighters and the EA-18G Growler electronic warfare jet.

This will give the "RAAF additional air-to-air intercept capability and increase interoperability with the US Air Force," the US Defense Security Cooperation Agency said.

Australia is a key US ally in the Asia-Pacific region and has contributed to forces to allied counter-terror operations in Afghanistan and Iraq.