The Governments of India and the State of Israel signed a Bilateral Investment Agreement (BIA) aimed at strengthening economic ties and fostering mutual investments between the two nations. The agreement was signed in New Delhi by Union Finance and Corporate Affairs Minister Smt. Nirmala Sitharaman and Israel’s Finance Minister H.E. Bezalel Smotrich.
The BIA is expected to provide greater certainty and protection for investors by establishing a minimum standard of treatment and an independent arbitration mechanism for dispute resolution. The agreement also includes provisions to safeguard investments against expropriation, ensure transparency, and facilitate smooth transfers and compensation in case of losses.
This agreement marks a significant step in bilateral relations as Israel becomes the first Organisation for Economic Co-operation and Development (OECD), member state with which India has signed an investment treaty based on its new model framework. The new treaty replaces the earlier agreement signed in 1996, which was terminated in 2017.
In a joint statement, both ministers underscored their commitment to enhancing economic cooperation across key sectors such as fintech innovation, infrastructure development, financial regulation, and digital payment connectivity. They also discussed potential collaboration through regional development banks and agreed to explore the creation of a bilateral financial protocol to improve financing for exporters.
Minister Smotrich invited his Indian counterpart for a reciprocal visit to Israel and proposed exploring the possibility of establishing a Finance Ministry representation in India to promote joint projects and deepen ties with local stakeholders.
The signing of the agreement follows months of collaborative work between the Chief Economist teams of both countries. Minister Smotrich’s delegation, which includes senior officials from the Israeli Ministry of Finance and the Israel Securities Authority, is currently in India to engage in discussions on broader economic cooperation.
Expressing his appreciation, the Israeli Finance Minister thanked the Embassy of Israel in New Delhi for its support in facilitating the agreement, describing their role as pivotal in achieving this milestone.
