Gems and jewellery, along with electrical machinery, continue to dominate trade between India and Israel, which launched a string of strikes on Iranian sites on June 13, but it is arms and ammunition have seen the fastest growth in the past decade.
Though Israel’s exports to India have declined over the years, a Moneycontrol analysis shows that the arms and ammunition trade between the two countries surged 33-fold between 2015 and 2024.
In 2024, the weapons trade between New Delhi and Tel Aviv was worth $185 million, a huge jump from $5.6 million in 2015.
The year 2023 was the biggest year, with bilateral arms trade touching $265 million.
Most of this trade comprises imports by India, which is one of the world’s biggest buyers of weapons. Israel exported $168,000 worth of arms to India in 2015. The figure rose to $135 million in 2023 before slipping to $128 million in 2024.
In 2024, arms and ammunition emerged as the second-largest import from Israel after electrical machinery. Until 2020, this category did not even feature in India’s top 10 imports from Israel.
India continues to buy military equipment predominantly from Russia, the United States, and France.
Could an Israel-Iran war disrupt India's trade?
Israel accounts for a small share of India’s overall trade, just $3 billion out of a total of $1,160 billion, to dent New Delhi’s exports but a disruption of shipping lanes can upend trading.
The immediate concern is the Strait of Hormuz, a critical shipping lane through which nearly a fifth of the world’s oil passes. A full-blown war between the two countries could lead to the closure of the narrow strait, security experts have said.
Early on June 13, Israel launched coordinated attacks on Iranian territory, reportedly destroying nuclear installations and targeting senior members of armed forces in Tehran.
In a televised address, Prime Minister Benjamin Netanyahu described the operation as critical to ensuring Israel’s “very survival”.
“This military operation aims to roll back the Iranian threat to Israel’s very survival. It will continue for as many days as necessary to eliminate that threat. For decades, the tyrants in Tehran have openly and brazenly called for the destruction of Israel,” Netanyahu said.
A few hours later, Iran retaliated with more than 100 drones, reports citing Israel said.
India’s trade with Israel began tapering off in 2023. India’s exports to Israel fell from a peak of $7.6 million in 2022 to $6.1 million in 2023 and to $2.1 million in 2024.
Explosives, base metals and machinery, which includes smartphones, were the categories to see a jump in exports.
Explosives exports were up 200 percent in 2018 from the previous fiscal, while electrical machinery was up 18 percent.
Imports dropped by more than half — from $2.8 billion in 2022 to $1.3 billion in 2024.
The nature of imports has shifted as well. Consumer goods made up 4.7 percent of imports from Israel in 2015 but increased to 17.8 percent in 2024. Capital goods’ share nearly doubled — from 27.1 percent in 2015 to 45.7 percent in 2024.
Despite the volatility, India’s exports to Israel have grown faster than imports. Israel’s share in bilateral trade declined to 31.5 percent over the past four years, compared with 36.5 percent in the pre-Covid period and 38.9 percent during 2011–2015.
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