India-Israel Special Strategic Partnership: Defence, UPI, Energy, and AI Agreements from Modi-Netanyahu Summit

India and Israel have a complex bilateral history shaped by India's traditional support for the Palestinian cause during the Non-Aligned Movement era. India voted against the 1947 UN partition plan that created Israel. Full diplomatic relations were established only on January 29, 1992 — after the Cold War's end enabled a recalibration of India's foreign policy. The relationship underwent another strategic shift in 2017 when Prime Minister Modi made the first-ever visit by an Indian PM to Israel, "de-hyphenating" India's relationships with Israel and Palestine.

Two key multilateral frameworks involve both India and Israel: the I2U2 grouping and the India-Middle East-Europe Economic Corridor (IMEC).

Key Details

• I2U2 (India, Israel, UAE, US): Established at a virtual summit on July 14, 2022. Focus areas: water, energy, transportation, space, health, food security, and technology. The grouping is sometimes called the "West Asian Quad" or "Middle East Quad." India hosts I2U2 summits in rotation.
• IMEC (India-Middle East-Europe Economic Corridor): Announced at the G20 New Delhi Summit on September 9, 2023, as a US-backed alternative to China's Belt and Road Initiative (BRI). The corridor proposes a multimodal rail-and-shipping network connecting India → UAE → Saudi Arabia → Jordan → Israel → Europe. Involves India, UAE, Saudi Arabia, Jordan, Israel, EU, Italy, France, Germany, and the US as signatories to the initial MoU. The Israeli portion (connecting Jordan to the Mediterranean) is critical for the corridor's Europe-facing leg.
• IMEC faced delays following the October 7, 2023 Hamas attack on Israel and subsequent Gaza conflict; the 2026 summit's IMEC reaffirmation signals intent to proceed despite regional instability.

Unified Payments Interface (UPI) is India's real-time payment system, developed by the National Payments Corporation of India (NPCI) under the Reserve Bank of India's regulatory framework. UPI was launched in April 2016, enabling instant bank-to-bank transfers through a single mobile application using a Virtual Payment Address (VPA). Its global expansion is coordinated by NPCI International Payments Limited (NIPL), a subsidiary of NPCI.

Key Details

• UPI as Digital Public Infrastructure (DPI): UPI is India's flagship example of a "public good" digital infrastructure layer — openly accessible, interoperable, government-backed but privately operated. India has been actively promoting DPI exports as a component of its foreign policy and development cooperation.
• UPI operational internationally (as of early 2026): UAE, Singapore, Bhutan, Nepal, Mauritius, Sri Lanka, France, Qatar, Malaysia (expanding), Japan (trial phase from April 2026).
• UPI-Massav linkage (Israel): Massav is Israel's interbank clearing system; linking UPI to Massav enables Indian tourists, students, and business travellers in Israel to make digital payments from Indian bank accounts.
• NPCI was established under Section 25 of the Companies Act (not-for-profit company) in 2008, promoted by RBI and the Indian Banks' Association (IBA).
• India's G20 Presidency (2023) was used to advocate for DPI and UPI as a model for developing-country financial inclusion — the "G20 Framework for Systems of Digital Public Infrastructure" was adopted under India's presidency.

Defence cooperation is the backbone of India-Israel relations, growing from an approximate USD 500 million annually in the early 2000s to over USD 2.5–3 billion in recent years, making Israel India's second- or third-largest defence supplier.