The US on Wednesday removed restrictions on funding for Israeli research in the occupied West Bank and Golan Heights, a policy that had been in place since the 1970s.
Prime Minister Benjamin Netanyahu praised the “huge significance” of the move, made less than a week before the US presidential election.
“Today, the United States and Israel agreed to remove geographic restrictions in each of the agreements,” a US embassy statement said.
Through the 1970s, the US established three funding agreements for Israeli scientific foundations.
But these agreements stipulated that financial support could not be channelled to projects conducted in areas that Israel occupied after the 1967 Arab-Israeli War, including the West Bank and the Golan Heights, which was seized from Syria.
President Donald Trump recognised Israeli sovereignty in the Golan and has not criticised Jewish settlement construction in the West Bank.
Mr Trump’s challenger, former vice president Joe Biden, broadly backed an international community consensus that such settlements in the West Bank are illegal.
Yonatan Freeman, a political scientist at the Hebrew University of Jerusalem, told AFP news agency that the goal of Wednesday’s event was “trying to cement Trump as the more pro-Israel candidate”.
The Trump administration has also brokered normalisation deals for Israel with the UAE and Bahrain, pacts the president highlighted during his campaign events.
Sudan said it will also establish ties with Israel.
