"Conflict of interest" stories have been rife in the media since Channel 10 television revealed that lawyer David Shimron also represents the Israeli agent of the German group ThyssenKrupp which builds the submarine.
But the premier, who has sworn he was unaware of Shimron's link to the deal, defended the purchase of the advanced submarines at Sunday's weekly cabinet meeting.
"The principle that guides me is clear: Israel will be able to defend itself by itself against any enemy, in any field," he said.
"The security of Israel requires the acquisition of submarines and the renewal of the submarine fleet.
"These are strategic weapons systems that ensure the future, and I tell you, the very existence of the state of Israel for decades to come."
The purchase is facing mounting calls for an investigation, especially in light of opposition from sectors of the armed forces command and some defence experts because of the high costs.
According to Israeli media, the Jewish state has ordered three more submarines at a combined price of 1.2 billion euros ($1.3 billion), to replace the oldest vessels in its existing Dolphin fleet, which began entering service in 1999.
Israel already has five of the state-of-the-art German submarines, with a sixth due for delivery in 2017, Maariv newspaper reported.
Germany, in the form of military assistance, has so far covered a third of the costs of the submarines in the Israeli fleet.
Foreign military sources say the Dolphins can be equipped with missiles armed with nuclear warheads.
Israel is the Middle East's sole if undeclared nuclear power, refusing to confirm or deny that it has such weapons.
Agence France-Presse
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