India Israel Trade

India Israel Trade Agreement

Last updated: Feb, 2023

Introduction

India is Israel’s 2nd trading partner in Asia and the 9th largest globally. The bilateral trade has been majorly dominated by diamonds and chemicals. However, recent years have seen an increase in trade in areas such as electronic machinery and high-tech products; medical equipment; communications systems, etc. The two nations celebrated 30 years of the upgradation of bilateral ties to full diplomatic relations earlier in 2022.

India-Israel Trade

The merchandise trade between the two nations has diversified and reached from US$ 200 million in 1992 (comprising primarily of diamonds) to US$ 7.86 billion (excluding defence) during the period 2021 - 2022 with the balance of trade being in India’s favour.
India is Israel's third-largest trade partner in Asia and seventh-largest globally.
Nearly 300 Israeli companies have invested in India
Major exports from India to Israel include diamonds, precious stones and metals, chemical products, textiles and textile articles, refined petroleum, broadcasting equipment, electrical and electronic equipment, packaged medicaments, organic chemicals, etc.

Major exported items from India to Israel with amount & quantity

India exported 3,404 commodities to Israel in FY21.
India’s export to Israel stood at US$ 4.79 billion in FY 2021-22.
Major exported items from India to Israel include mineral fuels, mineral oils & products; bituminous substances; mineral waxes (US$ 1,627.02 million); followed by pearls, precious or semi-precious stones/metals and articles thereof; imitation jewelry and coin (US$ 1,474.12 million) in FY21.
India’s export to Israel stood at US$ 5.4 billion during April-November 2022.
Major exported items from India to Israel include petroleum products (US$ 3,523 million) followed by pearls, precious and semi-precious stones (US$ 887 million), etc. during April-November 2022

Major imported items by India from Israel with amount & quantity

India imported 1,450 commodities from Israel in FY21.
Imports from Israel to India stood at US$ 3.07 billion in 2021-22.
India's imports from Israel include pearls, precious or semi-precious stones/metals and articles thereof; imitation jewelry and coin (US$ 1,319.47 million); followed by electrical machinery & equipment & parts thereof; sound & tv recorders & reproducers & parts thereof (US$ 685.28 million) in FY21.
Imports from Israel to India stood at US$ 1.5 billion during April-November 2022.
India's imports from Israel include pearls, precious or semi-precious stones/metals, and articles thereof (US$ 566 million) followed by fertilizers manufactured (US$ 311 million) during April-November 2022.

Recent Trends & developments

Under a comprehensive work plan for cooperation in agriculture signed on May 10, 2006, bilateral projects are implemented through MASHAV (Center for International Cooperation of Israel’s Ministry of Foreign Affairs) and CINADCO (Centre for International Agricultural Development Cooperation of Israel’s Ministry of Agriculture and Rural Development). Agricultural cooperation between the two sides is formalized through three-year action plans. The two countries are currently implementing the fifth phase of the joint action plan (2021-23).
On 22 September 2020, a Memorandum of Understanding (MoU) was signed between Israel’s Start-Up Nation Central and India’s International Centre for Entrepreneurship and Technology (iCreate) to initiate a bilateral program to accelerate innovation and technology cooperation between start-ups and corporates from both countries. The aim of this program is to bring together Israeli and Indian entrepreneurs and startups to collaborate on innovative projects.
India and Israel have restarted negotiations for the Free Trade Agreement (FTA) with an aim to conclude it in 2022.
India and Israel celebrated the 30th anniversary of full diplomatic ties in 2022 with flag colors illuminating historic landmarks in both countries. They also launched a commemorative logo featuring the Star of David and the Ashoka Chakra, symbolizing strong friendship and admiration between the two nations.
As India and Israel prepare for a Free Trade Agreement, Israel wants to leverage synergies between India’s manufacturing potential and Israel’s technological know-how. Mr. Naor Gilon, Israel’s Ambassador to India, on June 29, 2022, expressed Israel’s desire to share technology for the success of India’s flagship program ‘Make in India’. At the same time, he also expresses concerns about the violation of Intellectual property norms.
On July 14, 2022, India and Israel, along with the United Arab Emirates (UAE), and the United States, convened for the first leaders’ meeting of the I2U2 group, which was established in October 2021. The group has focused on launching initiatives focusing on food security as well as clean energy. I2U2 group will also advance a hybrid renewable energy project in Gujarat state (India), consisting of 300 megawatts of wind and solar capacity.
India too has been expanding its economic presence in Israel. In July 2022, Adani Ports and Special Economic Zone Ltd (APSEZ), a joint venture between India’s Adani group and Israel’s Gadot Chemicals Tankers and Terminals Ltd, won the bid for Haifa Port at US$ 1.18 billion. Haifa is Israel’s second-largest port and serves as a major trade hub on the country’s Mediterranean coast.

Economic and Defence Relations

In recent years, bilateral trade between the two countries has diversified into several sectors such as pharmaceuticals, agriculture, IT and telecom, and homeland security. India continues to be a focus country for the Israeli Government’s increased trade efforts. Moreover, the FDI inflows into India reached US$ 280.57 million during April 2000-September 2022.
Investments in the start-up and tech ecosystems have become quite significant. The total Israeli investments in Indian projects till 2021 have been valued at US$ 270 million, with Teva Pharmaceuticals, Ecoppia, and Naa’n Dan Jain being the top three notable investors in the clean energy, water management, and health domains.
In addition to trade and business, India is the largest buyer of military equipment from Israel, which, in turn, is the second largest defence supplier to India, after Russia. Ties between Israel and India have grown closer in the last decade and the two countries have formed a significant number of strategic, military and technology partnerships.

Conclusion

India and Israel maintain a strategic relationship and a free trade deal between the countries would significantly boost existing collaboration. The elevation of ties in the strategic partnership will expand this emerging cooperation in more new areas.

Contacts

Embassy of India in Israel
Address: 140, Hayarkon Street, PO Box 3368, Tel Aviv-6345103
Telephone: 00-972-3-7620700

Shri SANJEEV KUMAR SINGLA (Ambassador) – amb.jakarta@mea.gov.in
Phone: 03-762070 - 03-5223270
Email – amb.telaviv@mea.gov.in

Shri RAJIV BODWADE (Deputy Chief of Mission) – amb.jakarta@mea.gov.in
Phone: 03-5220631
Email – dcm.telaviv@mea.gov.in
Embassy of Indonesia, India
Address: Embassy of Israel, 3, Dr. APJ Abdul Kalam Road, New Delhi-110011
Mr. Ohad Nakash Kaynar (Deputy Chief of Mission)