India and Israel ink bilateral investment agreement to boost trade ties

India and Israel have signed a Bilateral Investment Agreement (BIT) in New Delhi today, as Union Minister for Finance and Corporate Affairs, Nirmala Sitharaman, and Finance Minister of Israel, Bezalel Smotrich, signed the pact.

While most of the details about the BIT are yet to come out, the agreement is seemingly aimed at enhancing the ties in high-tech manufacturing, research & development and providing the outlook for future Israel-India partnership. The current investment agreement could enhance the overall investment across complementary areas between the two countries.

The BIT comes a few months after Reuven Azar, Ambassador of Israel to India, in February this year, had said India and Israel could geopolitically secure their supply chains and discover strategies to win the race for global competition.

India is Israel’s second-largest country partner in Asia for merchandise trade. Though bilateral merchandise trade has been dominated mainly by diamonds, petroleum products and chemicals, recent years have witnessed an increase in trade in areas such as electronic machinery and high-tech products; communications systems; medical equipment, etc.

Major exports from India to Israel include pearls and precious stones, automotive diesel, chemical and mineral products, machinery and electrical equipment, plastics, textile and apparel products, base metals and transport equipment, agricultural products.

Major exports from Israel to India include pearls and precious stones, chemical and mineral/fertiliser products, machinery and electrical equipment, petroleum oils, and defence, machinery and transport equipment.

In terms of investments, the cumulative ODI from India during April 2000 to April 2025 was $443 million. Indian companies that have a presence in Israel include TCS, State Bank of India, Sun Pharma, Infosys, Tech Mahindra and Wipro Infrastructure Engineering, Lohia Group, Adani Group, among others. In 2022, a consortium led by Adani Ports and Special Economic Zone Ltd (APSEZ) acquired the rights to operate the Haifa Port Company from Israel, with an overall investment of $1.18 billion.

In terms of Israel's major investments in India, during April 2000–March 2024, Israel's direct FDI into India was $334.2 million. There are over 300 investments from Israel in India, mainly in the high-tech domain, agriculture and water. Teva Pharmaceuticals, Ecoppia, Naa’n Dan Jain, Aqwise, Polemix, Eli Hajaj, among others, are among the leading Israeli companies with an Indian presence.