India, Israel enter deeper trade and tech ties with FTA talks
India and Israel are strengthening their relations centred on trade talks, technology partnerships and strategic coordination, according to a new report.
The report from India Narrative said that the countries signing Terms of Reference in Tel Aviv to begin talks on a proposed Free Trade Agreement (FTA) proves a new phase of enhanced bilateral ties has begun.
A new bilateral investment framework, and sectoral cooperation in areas like agritech, water, cyber, and defence is also underway, the report said.
Officials on both sides are signalling a phased FTA—an “early harvest” first phase focusing on low?contention items and quick commercial gains, followed by a second, more ambitious round on sensitive sectors, it said.
Looking ahead, the “next phase” of India–Israel ties will likely be defined by how quickly the legal and institutional architecture being built now translates into real projects on the ground, according to the report.
A new Bilateral Investment Agreement (BIA) signed in 2025 offers investors improved legal comfort, including a shorter local?remedies period for Israeli investors and coverage of portfolio investments—which India has generally been cautious about.
The push comes as bilateral merchandise trade softened, with India’s exports to Israel falling to about $2.14 billion in 2024–25 and imports declined to roughly $1.48 billion, taking total trade to about $3.6 billion.
Israel is notably India's first Organisation for Economic Co-operation and Development OECD partner who is party to a modern BIA, indicating the relationship is being used as a testbed for more sophisticated capital?flow arrangements.
The report said that India should prioritise a phased FTA focused on high?tech goods, services and innovation. Further scaling pilot collaborations in agritech, water management and cyber space into national programs in India and deeper defence industrial cooperation should prioritised, the report said.
