India and Israel finalise terms for free trade deal, Goyal says FTA will strengthen economic ties
text_fields
India and Israel on Thursday finalised the terms of reference for a free trade agreement (FTA), marking a major step toward deepening economic engagement between the two strategic partners.
Commerce Minister Piyush Goyal, speaking in Tel Aviv alongside Israel’s Economy Minister Nir Barkat, said the FTA will be a “force multiplier” in India-Israel relations.
Both countries are targeting $30–40 billion in bilateral trade in the coming years. They aim to push this further to $65 billion over the next decade.
Goyal said the two nations began negotiations for the FTA soon after signing a bilateral investment treaty.
He said at a press conference that they had entered into negotiations for a free trade agreement soon after concluding a bilateral investment treaty, adding that the two together would open the door to greater market access, capital flow, investment, and trade. He explained that the agreements would remove obstacles to doing business and provide clarity, predictability, and stability to their economic engagement. He also noted that the two nations were strategic partners with a deep-rooted friendship.
Barkat said Israel is keen on forming joint ventures for large-scale manufacturing with Indian companies. “India will be a priority for Israel. It will be the hub for Israel in Asia. Our governments will make trade simple,” he said. He also met Israeli Finance Minister Bezalel Yoel Smotrich during the visit.
Goyal noted that Israel is not seeking access to India’s dairy, rice, or sugar sectors. Instead, it wants to ship more goods from India. He said the FTA will ensure mutual market access, reduced duty structures on a reciprocal basis, and a lowering of non-tariff barriers.
He is travelling with a 60-member business delegation, which includes major Indian firms such as Mahindra, Amul, and Asian Paints, along with startups and companies from sectors including pharma, agritech, defence, construction, and e-commerce.
Talks on the India-Israel FTA began in May 2010 and have gone through eight rounds. Negotiations were formally revived in October 2021.
Bilateral trade between the two countries reached $6.5 billion in FY24. However, India’s exports to Israel dropped 52% in 2024–25 to $2.14 billion, while imports from Israel fell 26.2% to $1.48 billion.