The India-Israel Bilateral Investment Agreement (BIA), signed on September 8, 2025, has officially taken effect. This trade pact aims to strengthen economic ties between the two nations and provide a stable investment environment. The agreement emphasizes protecting investments while allowing flexibility for sovereign policies aligned with public interests.
On the signing day in New Delhi, Finance Ministers from both countries, Nirmala Sitharaman and Bezalel Smotrich, were present. The BIA is anticipated to boost investments, offer investor protection, and enhance trade and mutual investments. It includes mechanisms for dispute resolution through arbitration and provisions to safeguard against expropriation.
The agreement is set to increase cross-border investments, currently valued at $800 million, benefiting businesses in both India and Israel. It ensures a minimum standard of treatment for investors and includes measures for transparent operations and compensation for losses. The focus is on balancing investor protection with the regulatory rights of the State, allowing room for sovereign governance.
Finance Minister Sitharaman highlighted the need for increased business interactions to maximize the benefits of this agreement. The Israeli Finance Minister acknowledged the shared economic growth trajectory despite security challenges. Both ministers expressed their dedication to enhancing economic cooperation, particularly in fintech innovation, infrastructure development, financial regulation, and digital payment connectivity.
