In 2024–25, India’s exports to Israel dropped by 52 per cent to USD 2.1 billion, while imports from Israel fell 26 per cent to USD 1.5 billion.
India and Israel signed the Terms of Reference (ToR) on Thursday to officially begin talks on a free trade agreement, Commerce and Industry Minister Piyush Goyal said. The ToR sets the framework for negotiations and covers several key areas, including reducing tariff and non-tariff barriers to improve market access for goods, making investments easier, simplifying customs processes, boosting cooperation in innovation and technology transfer, and relaxing rules to support trade in services.
Goyal, who is heading a 60-member business delegation, said that dates for the first round of talks will be decided soon. He added that the agreement could help both countries overcome existing challenges, strengthen bilateral trade, and create new opportunities.
He also mentioned that Israel has assured India it will not seek market access in sensitive sectors such as dairy, rice, wheat, and sugar.
He also informed that Israel has come out with pre-qualification documents for a metro project. It is a USD 50 billion (Rs 4.5 lakh crore) worth project and Indian companies can participate in this, Goyal said, adding that at present, in over 20 cities, India has metro lines.
“We have already agreed that whatever will be the sensitivities of Israel, India will keep out that from the agreement and similarly, whatever is sensitive for India, Israel will keep that,” he said, adding, “We want a win-win agreement for both the countries”.
India and Israel had earlier worked on a similar trade agreement and held eight rounds of talks. The new effort comes at a time when India is actively seeking more trade partnerships to expand and diversify its export markets. Although India and Israel share a strong strategic relationship, trade has never been a major highlight. Israel may not be a big consumer market, but it is a global leader in advanced technology. Many Israeli companies could also use India as a manufacturing hub—both for selling within India and for exporting to other countries.
Israel’s economy minister, Nir Barkat, said that India is a strong opportunity for investment. He added that the “Make in India” initiative is one of the smartest ideas and is suitable for many Israeli businesses.
In 2024–25, India’s exports to Israel dropped by 52 per cent to USD 2.1 billion, while imports from Israel fell 26 per cent to USD 1.5 billion.
(With agency inputs)
