Israel and India deepen ties with new investment agreement

On September 8, 2025, representatives from Israel and India gathered in New Delhi for a significant event signifying deepened economic ties between the two nations. The bilateral investment agreement (BIA) signed during this ceremony aims to foster mutual investment flows and enhance trade between the countries. The agreement was signed by Israel’s Finance Minister Bezalel Smotrich and India’s Finance Minister Nirmala Sitharaman, highlighting the cooperative efforts of both governments to build stronger economic connections in an increasingly interconnected global market. Israeli officials described the event as a historic milestone in Israel-India relations. The BIA replaces a previous treaty that was signed in 1996 and later terminated in 2017 due to India's review of its investment agreements. The signing of this new agreement came after months of collaborative discussions between the Chief Economist teams from both nations, intending to enhance investor confidence and create a framework that protects mutual investments. Dr. Shmuel Abramzon, Chief Economist at the Israeli Ministry of Finance, expressed optimism that the agreement serves as a crucial economic growth engine while also noting the prominence of India as a rapidly developing economic powerhouse. Furthermore, the BIA is viewed as a strategic advancement that will open new opportunities for both Israeli and Indian investors, fortifying exports and providing businesses with the necessary tools to navigate the world’s fastest-growing markets. Both parties acknowledged the urgency of adapting to current global economic demands and the necessity of strengthening their partnership through government and business collaborations. The discussions also highlighted potential future cooperation in sectors such as innovation, infrastructure development, financial regulation, and digital trade. In the context of broader trends, India has been actively signing bilateral investment treaties with various nations, including recent partnerships with the United Arab Emirates and Uzbekistan. This strategic move seeks not only to secure economic growth but also to equip both countries to effectively manage disruptions in global supply chains, leveraging India's large market and Israel's technological expertise. By formalizing protections for investors and establishing a clearer legal structure for cross-border investments, the agreement aims to significantly bolster investor confidence and foster long-term economic development for both nations.