Infographic | A look at Israel and Iran's current military capacity

Iran's Islamic Revolutionary Guards Corps said it launched dozens of drones and missiles at Israel late on Saturday, an attack that triggered a major escalation between the regional archenemies, with the US backing Israel.

Iran's state news agency cited a source saying its military had also launched a first wave of ballistic missiles against Israel.

Iran had vowed retaliation for what it called an Israeli strike on its Damascus consulate on April 1 that killed seven Guards officers including two senior commanders and said its strike was a punishment for "Israeli crimes". Israel has neither confirmed nor denied responsibility for the consulate attack.

US President Joe Biden, who on Friday had warned Iran against attacking Israel after saying such a scenario appeared imminent, has pledged to stand with Israel against Iran.

US and British warplanes were involved in shooting down some Israel-bound drones over the Iraq-Syria border area, Channel 12 reported.

In this context, let us look at the military strength of the two countries:

Notably, according to the Global Firepower Index, Iran ranks 14th among 145 countries in terms of defense strength while Israel is at the 17th position.

Iran's defense budget is more than $9 billion while Israel's is $24 billion. The two countries' purchasing power parity tells a different tale. Iran's is $1.3 trillion while Israel's is $393 billion.

Markets tell a worrying tale

Global markets have also been affected by Iran's recent attack. Gold prices shot up and markets around the world took a hit. However, on Monday, gold prices took a breather after hitting an all-time high in the previous session, as investors sought after safe-haven assets amid heightened conflict in the Middle East.

India's stand

In the middle of this standoff between the two nations, India has said that it will take a policy decision to mitigate any effect on its trade from the conflict between Iran and Israel after it has fully understood the impact.

"Policy interventions will only come after we understand the issues traders are facing. Based on that exercise, whatever is needed definitely government will address that," India's Trade Secretary Sunil Barthwal told reporters.

India, the world's third largest oil importer and consumer, imports a significant chunk of its petroleum purchases from the Middle East.

Oil prices slipped on Monday, with the market downplaying the risk of broader regional conflagration after Iran's weekend attack on Israel.

With agency inputs