Though the two countries are currently holding negotiations on FTA in New Delhi, he is not expecting a breakthrough in couple of days. He hopes the two sides would be able to sign the agreement by the end of this year.
The envoy said the two sides were focusing on the list of items and admitted that the negotiations were difficult and complicated.
"I can't predict outcome of negotiations. I believe it is the most important platform to take forward what we are doing together," he said.
"The minute we have FTA, I believe, our focus of trade or composition of trade will shift from traditional things that we have been doing together to hitech, to inventing, producing and marketing products together," he told reporters here Wednesday.
He said the advantages FTA go way beyond volume of trade.
While the volume of trade will go up by billions of dollars, the main advantages will be greater interaction between private sectors and the shift of trade towards services like hitech, telecommunications, pharmaceutical, healthcare, agriculture and renewable energy.
Though the trade decreased during 2012 because of economic challenges in both the countries, he believes the trend is positive.
The Israeli ambassador, who Wednesday concluded two-day visit to Hyderabad, saw great potential in cooperation with India in agriculture, water and energy.
Alon visited the R&D Centre of Makhteshim Agan India Pvt. Ltd., the Indian Subsidiary of the Israel-based Makhteshim-Agan Group, located near Hyderabad and engaged in research activities to bring in new technologies for the Indian farmers.
"The visit to the centre was the most pleasant experience as it goes hand in hand with what we are trying to do in India," he said.
Set up four years ago, it is the only R&D plant of the company outside Israel and employs more than 500 people.
The envoy noted that the centre was not only developing products tailor-made for Indian needs but wass also making products for marketing outside of India.
Israel also plans to set up a centre for vegetables in West Bengal. He discussed the proposal with the authorities during his visit to Kolkata 10 days ago.