India, Israel set to seal bilateral investment treaty this week
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Jerusalem: India and Israel are set to sign a Bilateral Investment Treaty (BIT) during Israeli Finance Minister Bezalel Smotrich’s visit to India this week, paving the way for a possible Free Trade Agreement (FTA) to boost economic ties, official sources said.
Smotrich will be in India from September 8 to 10 on a three-day visit, during which he is scheduled to meet Finance Minister Nirmala Sitharaman, Commerce and Industry Minister Piyush Goyal and Housing and Urban Affairs Minister Manohar Lal Khattar. Apart from New Delhi, his itinerary includes visits to Mumbai and Gujarat’s GIFT City in Gandhinagar.
“The visit aims to deepen Israel’s economic and financial ties with India through bilateral meetings and to prepare common ground for key agreements, including the BIT and FTA,” sources told PTI.
Negotiations on the draft BIT have already been concluded, and the finance ministers are expected to formally sign it during Smotrich’s visit. The treaty will offer protection to Israeli investors in India and Indian investors in Israel, in line with international standards and precedents.
According to officials, the BIT will enhance investor confidence by assuring a minimum standard of treatment, non-discrimination, and access to an independent arbitration forum for dispute resolution. It also safeguards investments against expropriation and guarantees transparency, free transfers and compensation for losses.
Israel has signed BITs with more than 15 countries since 2000, including the UAE, Japan, the Philippines, Thailand and South Africa. “This agreement reflects both nations’ shared commitment to strengthen economic cooperation and create a robust, resilient investment environment. It is expected to increase bilateral investments, benefiting businesses and economies on both sides,” a source said.
This marks the fourth visit by an Israeli minister to India in 2024. Earlier this year, Minister of Tourism Haim Katz, Minister of Economy and Industry Nir Barkat and Minister of Agriculture and Food Security Avi Dichter travelled to India.
India and Israel are strategic partners with bilateral trade close to USD 4 billion annually. Between 2000 and 2025, cumulative Indian investments in Israel reached USD 443 million, while Israel’s contribution to India’s FDI during April 2000–March 2025 stood at USD 334.2 million.
Israel is a global leader in high-tech innovation, while India offers unmatched scale and market potential, making them natural partners for growth and collaboration. Smotrich is also expected to tour the International Financial Services Centre (IFSC) at GIFT City, which provides world-class infrastructure for banking, insurance, capital markets and funds management.
With its liberal tax regime, financial incentives and strong regulatory environment, GIFT IFSC is emerging as a global financial services hub. Both countries also see strong potential for collaboration in the fintech sector, leveraging India’s large-scale digital infrastructure and financial inclusion platforms like UPI alongside Israel’s global leadership in cybersecurity, blockchain and payment technologies.
Officials said this cooperation could enhance financial innovation and help build secure, inclusive and scalable fintech ecosystems in both countries. As active members of institutions like the World Bank and the Asian Development Bank, India and Israel can also co-finance Multilateral Development Bank-backed projects or support joint initiatives in third countries, particularly in the Global South.
With PTI inputs
