NEW DELHI: India and Israel are set to resume formal negotiations on a proposed free trade agreement (FTA) after July, with the second round of talks likely to be held in Israel, according to two people aware of the matter.
The talks mark a renewed effort to conclude a trade pact that has been under discussion for more than a decade. Negotiations were first launched in 2010 but advanced only intermittently. In November 2025, India and Israel signed the Terms of Reference for the proposed agreement, formally launching negotiations and defining the scope and structure of the talks.
The first round was held in New Delhi from 23-26 February.
The proposed second round is expected to cover a wide range of issues, including trade in goods and services, technology cooperation, rules of origin, sanitary and phytosanitary (SPS) measures, technical barriers to trade (TBT), customs procedures and trade facilitation, intellectual property rights, and other areas aimed at building a comprehensive trade framework.
“The next round of talk has lots of hopes in terms of improving trade talks with Israel,” said one of the people cited above, requesting anonymity.
Strategic sectors
The proposed agreement could create opportunities in pharmaceuticals, information technology, cybersecurity, , semiconductors, agricultural technology, water management, renewable energy and other innovation-driven industries.
“India should focus on ensuring that its key concerns are adequately addressed during the negotiations, particularly on issues such as intellectual property rights (IPR), defence technology transfer, government procurement, data governance, movement of professionals, agricultural market access, and rules of origin,” said Dr. Ram Singh, a professor at the Indian Institute of Foreign Trade (IIFT).
Singh said differences remain on several issues. Israel is likely to seek stronger patent protections, freer cross-border data flows, greater access to government procurement and simplified rules of origin.
India, meanwhile, is expected to prioritize affordable access to medicines, technology localization, data sovereignty, domestic manufacturing, mobility for skilled professionals, protection of , and rules of origin consistent with those offered under its other trade agreements.
“The focus should therefore be on finding balanced solutions that address these concerns and enable meaningful progress in the negotiations,” he added.
Emails sent to the Embassy of Israel in India and the ministry of commerce and industry on Wednesday evening seeking comment remained unanswered at press time.
“An FTA is expected to strengthen bilateral trade and investment flows by lowering tariff and non-tariff barriers, improving market access, and enhancing regulatory cooperation across sectors,” said the second person.
Bilateral merchandise trade, excluding defence, peaked at more than $10.77 billion in FY23. It stood at around $6.53 billion in FY24 and approximately $3.62 billion in FY25, partly affected by regional security conditions and disruptions to trade routes. India is Israel’s second-largest trading partner in Asia and its seventh-largest globally.
Major Indian exports to Israel include, pharmaceuticals, chemicals, textiles and machinery. Imports from Israel are largely diamonds, chemicals, machinery, electronics and advanced technology products. Services trade, particularly information technology, also forms a significant part of the relationship.