Business / Industry Sectors
Israel keen to better trade with India
19/11/2014
Buoyed by India’s prospects for greater economic growth, Israel’s Minister for Economy Naftali Bennett has said that his Government is looking to further strengthen trade and technological ties between the two countries.

Source: totpi

“We think that India is an economy that is looking at one of the best futures in the world”, Mr. Bennett said last week at the inauguration of the Third Homeland Security Conference in Tel Aviv. He said that Israel is keen, not just on trading goods and services, but also on collaborating with India to develop new technologies together.

 

The two countries already share a close Defence relationship and are now looking to expand ties in areas as diverse as agriculture, water management, energy and homeland security. Mr. Bennett, who had visited India in 2013, soon after being taking office, has made a conscious attempt to shift Israel’s economic focus from Western markets to emerging ones, especially in Asia.

 

He has been closely involved in Israel’s negotiations with India over a free trade agreement. He had previously said that bilateral trade between India and Israel, which stood at $ 6 billion in 2013, could easily double once the agreement is signed. This FTA has been in the works since 2010 and the next round of negotiations is to be held later this month.

 

Progress has been slow but the talks are expected to gain momentum, especially since the FTA was mentioned at the meeting between Prime Ministers Mr. Narendra Modi and Mr. Benjamin Netanyahu in September on the sidelines of the UN General Assembly in New York.

 

According to Israeli officials, one of the reasons why the FTA has been stuck is because India has little incentive to sign the deal. “From our (Israeli) side everything is open… but if I have to export to India, I have to pay taxes”, explained Mr. Ramzi Gabbay, chairman of the Israel Export and International Cooperation Institute. 

 

However, since most of Israeli export is in the hi-tech arena, there have been questions from the Indian side over how much of its sophisticated technology Israel is willing to make available. In this regard, Mr. Gabbay said, “There are no limits on what we share with India. Everything is open.”

 

Notably, this is not the case with Israel’s other major Asian trade partner: China. While Israel does more business with China, it does not have a “strategic relationship” with the Asian giant, according to Israeli officials both in Government and in the private sector. Gabbay also pointed out that Israel’s trade ties with China are in the latter’s favour (much like India-China trade ties) and foreign businesses face the same kind of regulatory hassles in China as they do in India.

 

In fact, Israeli would like to welcome greater imports from India. Currently, diamonds and a few other precious metals make up the vast majority of India’s exports to Israel. According to the President of the Federation of Israeli Chambers of Commerce, Mr. Uriel Lynn, “We are importing a lot from China and competition in the manufacturing side from India will be of great advantage to Israel”. Mr. Lynn, however, cautioned that the changes in import-export patters will have to be carefully mapped over time but also made clear that there is ample scope for India to ramp up its exports to Israel, which will be beneficial to both countries.

 

Source: Daily Pioneer

 

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