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International relations

India, Israel aim to boost ties through defense tech and trade

Two sides are resuming long-stalled talks on free trade agreement

NEW DELHI/CAIRO -- India and Israel are pushing to strengthen ties by deepening cooperation in the fields of defense and information technology, as well as resuming long-stalled negotiations over a free trade agreement.

That comes as New Delhi looks to access Israel's advanced military technology and to indirectly reinforce its relationship with Washington, a close ally to Israel. In turn, Israel hopes to unlock huge new markets for its companies.

The Defense Research and Development Organization of India and Israel's Directorate of Defense Research and Development signed a bilateral agreement earlier this month to promote the development of technologies for both military and commercial use. Under the move, Indian and Israeli startups will work together on tech such as small unmanned aircraft and artificial intelligence.

That follows an October agreement between Indian External Affairs Minister Subrahmanyam Jaishankar and Israeli Foreign Affairs Minister Yair Lapid aiming to complete a bilateral FTA by June 2022. Negotiations originally started in 2010, but have long been suspended. Now, for the first time, the two governments have specified a target date for concluding the deal.

The bilateral FTA would enable the two countries to promote the development of IT-based technological innovations on top of India's access to Israel's advanced weaponry, said Somdeep Sen, associate professor in international development studies at Roskilde University in Denmark. "Israel has proven itself as a reliable supplier of high-quality military hardware and is willing to do so without any political preconditions," Sen added.

India's trade with Israel has totaled $3.5 billion so far in 2021, with electrical equipment, jewelry and energy at the heart of business between the nations. On the defense front, Israel is India's fourth-largest arms supplier, having exported arms worth $2.7 billion to the country between 2011 and 2020, according to Stockholm International Peace Research Institute.

In Israel, young people have been starting their own businesses, especially in the fields of cybersecurity and AI, utilizing their experience and personal relations nurtured during military service. The defense industry has developed through cooperation between the military and private sectors, with weapons, such as an air defense system called Iron Dome, proving highly effective in combat.

India is already a large importer of weapons from Israel. But beyond the defense industry, Israel hopes India will be a big market for its companies in sectors such as health care and agricultural technology.

India has concluded FTAs mainly with Asian countries including Japan. Starting in May, however, it announced the launch of negotiations with the U.K., the European Union and Australia.

The crisis in Afghanistan has been a key factor in prodding India to begin full-fledged efforts to diversify its diplomacy and approach the Middle East. Worries over terrorism have been looming over India's border areas since Afghanistan fell back under the control of the Taliban in August. And the Islamic militant group appears to have been getting in step with Pakistan and China's often hostile stances toward India.

Israel is known for formidable anti-terrorism measures, making it a potentially appealing partner for India.

Israel also maintains close ties with the U.S. and exerts a considerable amount of influence on Washington. India thus hopes to deepen its relationship with the U.S. by strengthening its ties with Israel.

In October, Jaishankar held a meeting with Sheikh Abdallah bin Zayed, the foreign affairs minister of the United Arab Emirates, U.S. Secretary of State Antony Blinken and Lapid. Indian media described the meeting as a step toward establishing a "new Quad," following the Quadrilateral Security Dialogue between Japan, the U.S., India and Australia.

The reinforcement of relations between the U.S. and India is opening the way to establishing a base of cooperation in the Middle East, Harsh Pant of the Observer Research Foundation, an independent think tank in New Delhi, said in reference to the framework formed by the U.S., India, Israel and the U.A.E. The "new Quad" reflects "the changing trajectory of India's diplomatic profile in the region," he added.

Israel normalized its diplomatic relations with the U.A.E. in 2020 through the mediation of the U.S. India's participation in the new framework is expected to enhance the new ties between the U.A.E. and Israel.

An Israeli diplomatic source said Israel and the U.A.E. "can link [even more deeply] between the U.S. and India," a development that creates "win-win-win" relations for all parties.

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