Israel’s Prime Minister Benjamin Netanyahu and India’s Prime Minister Narendra Modi attend a press conference in Jerusalem
| Photo Credit:
GIL COHEN-MAGEN
India and Israel on Thursday gave fresh momentum to bilateral trade ties by expediting negotiations for an early signing of a Free Trade Agreement (FTA) even as the two countries elevated their relationship to a “Special Strategic Partnership for Peace, Innovation and Prosperity”.
Jointly addressing media in Tel Aviv along with Israeli counterpart Benjamin Netanyahu on the last day of his two-day state visit to Israel, Prime Minister Narendra Modi said the two leaders discussed imparting a new direction and faster pace to bilateral cooperation.
“In today’s meeting, we discussed giving a new direction and a faster pace to our cooperation. Our economic cooperation is the engine of growth, innovation, and shared prosperity. To encourage mutual investment, we entered into a bilateral investment agreement last year. We will also soon finalise a mutually beneficial Free Trade Agreement,” he said.
Meanwhile, the next round of negotiations between the two countries for the FTA will be held in May, the commerce ministry said here. A Israeli delegation is here to hold FTA talks with government. The statement came after the two countries concluded the first round of four-day talks that discussed a wide range of issues — including trade in goods and services, rules of origin, sanitary and phyto-sanitary measures, technical barriers to trade, customs procedures, intellectual property rights, and digital trade.
Second visit
In his second visit to Israel in nine years, Modi also held talks with President Isaac Herzog, interacted with the Indian diaspora and the cast and crew of the global hit Israeli TV show Fauda on Thursday before flying back to India.
The push on the FTA comes alongside the India-Israel Bilateral Investment Agreement signed in September 2025, aimed at strengthening investor protection and dispute resolution mechanisms.
In a move with commercial implications, the two sides also agreed to explore linking India’s Unified Payments Interface (UPI) with Israel’s payment system. An MoU between NPCI International and MASAV was signed to examine cross-border digital payment interoperability, potentially easing transactions for businesses and travellers.
“Prime Minister Netanyahu appreciated India’s fintech revolution, exemplified by the Unified Payments Interface (UPI), which is a world-class model for affordable, real-time cross-border transactions. Both sides agreed to explore linking UPI with Israel’s fast payment system to enhance interoperability and strengthen economic ties,” the joint statement said.
Beyond trade, the partnership is being repositioned around critical and emerging technologies. The two leaders welcomed an MoU on Artificial Intelligence and launched a new initiative on Critical and Emerging Technologies led by their National Security Advisors, covering areas such as semiconductors, cybersecurity and quantum technologies.
An India-Israel Centre of Excellence in Cybersecurity is to be established in India, alongside a multi-year cyber cooperation roadmap.
Defence cooperation, a longstanding pillar of bilateral ties, was reviewed under the November 2025 MoU, with both sides outlining a forward roadmap.
The two countries also agreed to expand structured labour mobility, with up to 50,000 additional Indian workers expected to be employed in Israel over the next five years across construction, manufacturing and services sectors.
The elevation of ties and the formal launch of FTA negotiations indicate a shift toward a more integrated economic partnership, combining Israel’s technology strengths with India’s market scale and manufacturing base.
For Indian industry, the pace and contours of the FTA, particularly tariff liberalisation, services access and investment safeguards, will determine the depth of market access and technology collaboration that follows.
The Prime Ministers also agreed to strengthen the ongoing capacity-building program in agriculture in Israel, led by MASHAV in collaboration with the Ministry of Agriculture of India. This multifaceted program, as per the joint statement, benefits hundreds of thousands of Indian farmers through training, introduction of unique and innovative techniques and knowledge transfer.
Both welcomed the signing of the MOU between ICAR and MASHAV regarding the India – Israel Innovation Centre for Agriculture (IINCA).
Published on February 26, 2026