Indian SMEs Look to Tap Into Israel's Economy by gyvwpsjkko


									?Israel's sound market economy has grown at a steady pace in the past few decades.
In addition, Israel has benefited from its openness to foreign trade and investment,
which account for nearly half of its gross domestic product (GDP). With the aim to
enhance trade relations with Israel, a large number of Indian SMEs are turning
towards this Middle East country. Most Indian SMEs are aiming to tap Israel's
burgeoning yet untapped market.

Despite the lack of natural resources, Israel has successfully developed its agricultural
as well as industrial sectors in the last 20 years. Moreover, the government has
formulated a number of trade policies to provide an impetus to the main sectors in the
country. As a result of these concerted efforts, the Israeli economy grew at 4.2% in
2008.[1] In addition, foreign investments have played a key role in bolstering the
economy and supporting the major industries.

Indo-Israeli trade relations

Since 1992, India has become a major trade partner of Israel. It is one of the chief
exporters of diamonds, rubber, plastic products, base metals, transport equipment and
textiles to Israel. Alternately, Israel's export basket to India comprises machinery,
chemical products and medical equipment. Significantly, the bilateral trade between
India and Israel stood at $4,012.50 million at the end of 2008.

Although diamonds have dominated bilateral trade between India and Israel, analysts
opine that there are several other potential areas of growth that can be explored by the
Indian SMEs in Israel. Infrastructure, real estate and financial services are ranked as
the most critical areas of mutual cooperation and growth.

For trade and investment

While a number of Indian firms have invested in sectors like pharmaceuticals, tyre
manufacturing and digital marketing in Israel, there are many other unexplored
avenues where the Indian firms can pump funds and earn a higher return on
investment. These include sectors like agro industry, biotechnology, floriculture,
telecommunications, chemicals and computer software.

Indian firms can also collaborate and forge trade alliances with their Israeli
collaborators to set up research and development (R&D) facilities in Israel. Industry
Experts believe that by entering into strategic alliances with the Israeli SMEs, Indian
SMEs can gain from their technical know-how and adopt modern manufacturing
practices to drive their business.

Collaboration holds the key

To facilitate bilateral economic relations between the two countries, an Indo-Israeli
Joint Council was formed in 1993. In addition, the India-Israel Joint Work Programme
of S&T cooperation for 2003-04 was signed in 2002 to promote collaboration in the
field of genomics.

Furthermore, the India-Israel Initiative for Industrial R&D (IRD), a bilateral
framework to provide financial assistance for joint R&D ventures between Indian and
Israeli companies has been created to benefit SMEs of both countries.

With the governments of both countries taking steps to promote bilateral trade ties,
opportunities for growth are abundant in Israel for Indian SMEs.

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David Parks is a well known author and has written articles on B2B Products, B2B
Portal, Trade Leads, suppliers, Manufactures and many other subjects.

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