Bilateral Investment Agreement Signed

India and Israel have finalized a major investment agreement to strengthen trade, technology, and defence cooperation. The pact was signed in New Delhi by Israeli Finance Minister Bezalel Smotrich and Indian Minister of Corporate Affairs Nirmala Sitharaman during Smotrich’s official visit.

The deal aims to enhance collaboration in cybersecurity, defence technology, innovation, and high-tech industries, creating new opportunities for businesses in both countries.

Strategic Economic Cooperation

India’s Ministry of Finance described the agreement as a “historic milestone”, highlighting its focus on digital payments, fintech innovation, infrastructure development, and regulatory reforms.

Smotrich called the pact an important step for mutual prosperity, stating it will boost Israeli exports, attract investments, and provide stability for businesses in one of the fastest-growing markets globally.

Bilateral trade reached $3.9 billion in 2024, with current mutual investments valued at approximately $800 million. Defence and security remain major trade sectors, with India continuing as Israel’s top weapons buyer.

Gaza Conflict and Global Concerns

The agreement comes amid global criticism over Israel’s ongoing war in Gaza, which has reportedly resulted in over 64,000 Palestinian deaths since October 2023. Despite international outrage, India has maintained strong ties with Israel, including arms transactions during the conflict.

Pro-Palestine demonstrations in India have faced strict crackdowns, while pro-Israel rallies have been permitted. India continues to support a two-state solution but has abstained from several UN resolutions calling for an immediate ceasefire in Gaza.

Labour and Education Collaboration

The deal also impacts labour and education sectors: Israeli construction firms may hire up to 100,000 Indian workers, replacing Palestinian labourers whose permits were revoked.

Additionally, India remains the largest source of foreign students in Israel, strengthening cultural and educational ties.

Shifts in India’s Global Strategy

Amid these developments, India has strengthened ties with China and aligned with the Shanghai Cooperation Organisation (SCO) in condemning certain U.S.-Israeli actions. These moves indicate a strategic balancing of India’s foreign policy in the region.