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Tel Aviv/New Delhi — In a move set to redefine one of Asia’s most strategically important partnerships, India and Israel have formally signed the Terms of Reference (ToR) to commence negotiations for a comprehensive Free Trade Agreement (FTA). The signing, which took place in Tel Aviv, marks the official start of a concerted effort to leverage the complementary strengths of the world’s fastest-growing major economy and the ‘Startup Nation.’India’s Minister of Commerce and Industry, Piyush Goyal, and Israel’s Minister of Economy and Industry, Nir Barkat, penned the document, confirming their mutual ambition for a “win-win, fair, equitable, and balanced” agreement.
A New Force Multiplier for the Global Economy
The comprehensive FTA is designed to move the bilateral relationship beyond its traditional focus on defense and diamonds, opening new channels for market access, capital flow, and investment across goods and services.
“We are two countries which really don’t compete with each other,” Minister Goyal noted at the signing ceremony, highlighting the unique synergy between the two economies. “We act as a force multiplier for both countries.”
The agreement’s core focus will be on sectors where Israel’s cutting-edge technology can be seamlessly integrated with India’s massive scale and skilled workforce, potentially turning India into a key manufacturing and export hub for Israeli companies.
Key areas of negotiation outlined in the ToR include:
- Technology & Innovation: Facilitating cooperation in Artificial Intelligence (AI), Quantum Computing, FinTech, and Agri-Tech.
- Goods and Services: Eliminating tariff and non-tariff barriers to increase market access for products and services.
- Investment: Streamlining customs procedures and providing a more predictable, stable environment for investments.
- Strategic Sectors: Advancing joint ventures in water management, advanced manufacturing, life sciences, and infrastructure.
Guarding India’s Sensitive Sectors
A significant concession noted early in the process is Israel’s willingness not to seek market access in some of India’s most sensitive agricultural areas, including dairy, rice, wheat, and sugar. This gesture is expected to ease concerns among domestic Indian producers and fast-track the negotiation process.
The renewed push for the FTA comes shortly after the two nations signed a Bilateral Investment Agreement (BIA) in September, creating a fortified legal framework for mutual investments—laying a critical piece of the groundwork for the broader trade pact.
While trade figures in the last fiscal year saw a dip, both nations are banking on this FTA to ignite a new, explosive phase of economic collaboration, cementing their strategic partnership on a truly commercial foundation.
[Newsroom staff written original, where key claims or facts are used, I’ve referenced the original sources (like Al Jazeera, The Times of India, Hindustan Times, Reuters, etc.) transparently.]
