Tel Aviv, Nov 20 (PTI) India and Israel on Thursday inked terms of reference (ToR) to formally launch negotiations for a free trade agreement, Commerce and Industry Minister Piyush Goyal said.

The ToR include market access for goods by eliminating tariff and non-tariff barriers, investment facilitation, simplification of customs procedures, increasing cooperation for innovation and technology transfer, and easing norms to promote trade in services.

"We have signed the ToRs today. Now we will soon finalise the dates for starting the negotiations for that," Goyal told reporters here. Goyal is leading a 60-member business delegation to Israel. He will meet leaders and businesses to discuss ways to boost bilateral trade and investments.

The TOR was signed by Goyal and Israeli Economy and Industry Minister Nir Barkat.

Goyal said that the Israeli side has conveyed that they will not seek market access in sensitive areas such as dairy, rice, wheat and sugar.

He also informed that Israel has come out with a pre-qualification for a metro project. It's a USD 50 billion worth project and Indian companies can participate in this, Goyal said.

India and Israel had earlier engaged in negotiating a similar agreement and eight rounds of talks were held.

During 2024-25, India's exports to Israel dipped 52 per cent to USD 2.14 billion from USD 4.52 billion in 2023-24. Imports, too, fell 26.2 per cent to USD 1.48 billion last fiscal year.

India is Israel's second-largest trading partner in Asia. Though bilateral merchandise trade is dominated mainly by diamonds, petroleum products, and chemicals, recent years have witnessed an increase in trade in areas such as electronic machinery and high-tech products, communications systems, and medical equipment.

Major exports from India to Israel include pearls and precious stones, automotive diesel, chemical and mineral products, machinery and electrical equipment, plastics, textiles, apparel, base metals and transport equipment, and agricultural products.

Imports include pearls and precious stones, chemical and mineral/fertiliser products, machinery and electrical equipment, petroleum oils, defence, machinery, and transport equipment.

In September, both countries inked a Bilateral Investment Agreement (BIA), under which India has cut down the local remedies exhaustion period for Israeli investors to three years from the earlier five years.

During April 2000 and June 2025, India received USD 337.77 million foreign direct investment (FDI) from Israel. PTI RR MR

India-Israel FTA negotiations launched under ToR to address market access, tariffs, investment facilitation, and customs simplification. Terms of reference have been signed to formally launch negotiations on a free trade agreement between India and Israel, committing parties to address market access through elimination of tariffs and non-tariff barriers, investment facilitation, customs simplification, cooperation on innovation and technology transfer, and promotion of trade in services, with negotiation dates to be finalised; Israel has indicated it will not seek access in dairy, rice, wheat and sugar.