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India is not interested in re-starting discussions on a Free Trade agreement (FTA) with Israel despite Prime Minister Narendra Modi’s successful visit to that country recently as it expects to gain little from such a pact, a government official said.
Scope for tiesThere is, however, a lot of scope for cooperation in areas such as defence off-set manufacturing, space technology, drip irrigation and agriculture, which have shot into priority following the historic meeting between the Indian Prime Minister and his Israeli counterpart Benjamin Netanyahu and preparatory work has already started.
Not much gain“While the Israelis are keen to negotiate an FTA with India and have also communicated their interest, internal studies and industry consultations carried out by the Commerce Ministry over the years have shown that there are no discernable gains for the country,” a senior official told BusinessLine .
FTAs are required when there are stiff tariffs or non-tariff barriers between two trade partners, but India does not face any problems with Israel either on the tariffs front or in the form of technical barriers, the official explained. India-Israel bilateral trade was at $5 billion in 2016-17 with India’s exports at $3 billion and imports at $2 billion.
While the amount is higher than last year’s bilateral trade of $4.9 billion, it is lower than the $6-billion level of 2012-13 and 2013-14.
More tie-upsBut India is positive about the scope for greater cooperation as the two countries have different areas of strength and can gain by sharing technology and expertise.
“Israel’s strength lies in areas such as security, defence and irrigation while India is strong in space technology, defence off-set manufacturing and many services. There will be an increased number of tie-ups following the visit based on the MoUs signed by both leaders,” the official said.
The MEA has already started circulating the notes related to the visit to all Ministries and Departments concerned and work based on the MoUs would begin soon, the official added.
Modi and Netanyahu signed seven MoUs including ones on water conservation, industrial R&D fund, agriculture and space research.
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