Israel and India Renew Talks on Free Trade Agreement

Israel and India are turning a new page in their economic relations, with an official announcement on the resumption of negotiations for a free trade agreement, for the first time since the discussions were frozen in 2010.

The move was launched during the historic visit of the Indian Minister of Economy, Piyush Goyal, who landed in Israel at the head of a large business delegation comprising about 100 representatives from about 70 leading companies in the Indian industry.

The visit, the first of its kind since the announcement of the cessation of war, is perceived as a strategic move that expresses confidence in the Israeli economy, particularly during a period of recovery, and constitutes a turning point in relations between the countries. During the visit, a principles document for the rescue of the talks was signed, a move that was woven in recent months at the initiative of the Israeli Minister of Economy and Industry, Nir Barkat.

Barkat said that it is a "significant day for the Israeli economy", and emphasized that the renewed talks constitute a huge opportunity for exporters and industrialists: "India is a tremendous economic power, and the personal and direct connection that has been built allows us to promote an agreement that will yield growth, innovation, and jobs for Israelis."

His Indian counterpart Goyal defined the move as a "match made in heaven", and noted that the agreement is set to expand the movement of goods, services, and investments between the countries: "Israel for India and India for Israel. Together we will reach a broad, balanced, and good agreement for both sides."

Simultaneously, the Israel-India Business Forum was held in Jerusalem, during which hundreds of business meetings were held between companies from both countries, alongside tours of the Indian delegation in Israeli high-tech companies showcasing the local innovation forefront.

The negotiation for a free trade agreement between the countries has been ongoing continuously since 2010 but did not mature into an agreement. Now, after the signing of the foreign investment protection agreement last September and the tightening of the direct connection between the two ministers, a new momentum has been created that promotes the move in practice.

India, the fifth-largest economy in the world and home to 1.4 billion residents, is a strategic destination for Israel. In 2024, Israeli exports to India reached about $3.1 billion-the fifth-largest export destination-and grew by 56% in just four years, despite the effects of the war.

The Foreign Trade Administration notes that a free trade agreement could reduce some of the highest trade barriers in the world and give Israel a significant competitive advantage.

The future agreement is expected to include issues such as digital services, regulation, intellectual property, and government procurement, and is set to deepen the economic and strategic relationship between the two countries in the coming decade.