Union Finance Minister Nirmala Sitharaman and Israel’s Finance Minister Bezalel Smotrich signed a landmark Bilateral Investment Treaty (BIT) in New Delhi on Monday, marking a significant step in promoting investments between India and Israel. According to the finance ministry, this agreement makes Israel the first OECD member to adopt India’s new investment treaty model.

The BIT is designed to strengthen economic ties, provide financial protocols for Israeli exporters, and explore the possibility of establishing an Israeli Finance Ministry presence in India. Israeli FDI in India has reached $337.77 million between April 2000 and June 2025. The signing of this treaty is also seen as a precursor to a potential Free Trade Agreement (FTA) between the two nations.

During his three-day visit from September 8 to 10, Israeli Finance Minister Smotrich is scheduled to meet Commerce and Industry Minister Piyush Goyal and Minister of Housing and Urban Affairs Manohar Lal Khattar. He will also visit Mumbai and the GIFT City in Gandhinagar, in addition to Delhi.

The purpose of the visit is to deepen economic and financial ties through bilateral meetings and lay the groundwork for key agreements including the BIT and FTA.

The India-Israel BIT ensures protection for Israeli investors in India and Indian investors in Israel, guaranteeing a minimum standard of treatment, non-discrimination, and an independent forum for dispute resolution through arbitration. The agreement also includes safeguards against expropriation, ensures transparency, facilitates transfers, and provides compensation for losses.

Since 2000, Israel has signed BITs with over 15 countries, including the UAE, Japan, the Philippines, Thailand, and South Africa, reinforcing its commitment to promoting secure and transparent international investments.