India, Israel sign terms of reference for free trade agreement — a boost to bilateral ties

India and Israel on Thursday finalised the terms of reference for a free trade agreement (FTA), marking a significant step in strengthening commercial ties between the two strategic allies.

Congratulations for signing the TOR for a trade agreement btw 🇮🇱&🇮🇳 Ministers ⁦@PiyushGoyal ⁦@NirBarkat⁩ ! pic.twitter.com/80NymtmTr8

— 🇮🇱 Reuven Azar (@ReuvenAzar) November 20, 2025

Speaking in Tel Aviv alongside Israel Economy Minister Nir Barkat, Indian Commerce Minister Piyush Goyal said the FTA will act as a “force multiplier” in India-Israel relations.

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The two countries are targeting $30-40 billion in bilateral trade in the coming years, with ambitions to expand it to $65 billion over the next decade.

#WATCH | Tel Aviv, Israel: Union Minister of Commerce & Industry, Piyush Goyal says, "The first step to initiate the discussions on Free Trade Agreement (FTA) between India and Israel has been taken today. We signed the Terms of Reference today. Israel's Minister Nir Barkat and I… pic.twitter.com/HXGbu8Xfg2

— ANI (@ANI) November 20, 2025

“The first step to initiate the discussions on Free Trade Agreement (FTA) between India and Israel has been taken today. We signed the Terms of Reference today. Israel’s Minister Nir Barkat and I have forged a relationship just like that between PM Narendra Modi and PM Netanyahu. There is immense potential for partnership between the two nations; there are complementary possibilities. The two nations also face similar challenges. Keeping that in mind, we feel that this could be a good beginning. There will be a good agreement for bilateral trade and extensive new opportunities will be thrown open,” ANI quoted Commerce & Industry minister Piyush Goyal as saying.

Barkat said Israel looks at India, not just as an Indian market - which is the largest population in the world, but as a gateway to all of Asia.

#WATCH | Tel Aviv, Israel: After signing Terms of Reference (ToR) for FTA between India and Israel, Israel's Minister of Economy and Industry Nir Barkat says, "I viewed how India is waking up as a huge giant. India of tomorrow is a great power. We want to join a venture with… pic.twitter.com/AkHOr4xPTr

— ANI (@ANI) November 20, 2025

“I viewed how India is waking up as a huge giant. India of tomorrow is a great power. We want to join a venture with India to help India become stronger and bigger. At the same time, collaborate and make Israel stronger and better. So, there is a huge potential. I found a really good friend, Minister Piyush Goyal, and I see eye to eye on how to develop the complementary countries. You have the skill, we have innovation and the combination of the two is very important and big,” said Barkat.

“We also look at India, not just as an Indian market - which is the largest population in the world, but as a gateway to all of Asia. So, for Israeli entrepreneurs to understand how to do business with India is key, very important for our interests. I am very thankful and I am a big optimist as to where we could take the relationship…,” he added.

Goyal said Israel is not seeking access to Indian dairy, rice, or sugar markets, instead aiming to ship goods from India.

The FTA will provide mutual market access, a reciprocal reduction in duties, and lower non-tariff barriers, he added.

Goyal is accompanied by a 60-member business delegation, including major firms like Mahindra, Amul, Asian Paints, as well as startups and companies from pharma, agritech, defence, construction, and e-commerce sectors.

India-Israel FTA talks began in May 2010, with eight rounds held so far and formal negotiations revived in October 2021.

Bilateral trade stood at $6.5 billion in FY24, though India’s exports to Israel fell 52% to $2.14 billion in 2024-25, while imports dropped 26.2% to $1.48 billion.

With inputs from agencies