After the two leaders co-chaired the fifth Inter-Governmental Consultations, India and Germany signed five joint declarations of intent and inked 11 pacts in fields such as space, civil aviation, maritime technology, medicine and education.
The two countries signed several agreements on Friday in New Delhi, with Prime Minister Narendra Modi saying India is eager to benefit from Germany's expertise.
In recent months German firms have raised a few other concerns, including slowdown in India's auto sector, lack of stable policymaking and ad-hoc decisions which they say have affected buyer sentiment and created uncertainty among carmakers.
He said that India has invited Germany to take advantage of opportunities in defence production in the defence corridors in UP and Tamil Nadu.
In a separate interaction with the media Merkel commented on the Kashmir issue, "The situation for the people on the ground as of now is not good for the long-term, this certainly has to change", she said, adding that she would advocate "de-escalation and relaxation". Areas of 5G and artificial intelligence are a challenge and it is important to work on them together, she said.
Michaela Kuefner, the Chief Political Editor at DW, Germany's worldwide TV channel, tweeted that in a "modest pre-dinner criticism of the Kashmir clampdown, Merkel said that "the Situation for the people there is unsustainable and not good".
The two leaders stressed the importance of the combined effort of all countries to fight global terrorism and to send out a consistent message that terrorism in all its forms and manifestations is not acceptable.
Before heading home, the chancellor will also visit the Dwarka Sector 21 Metro Station.
Significantly, Merkel emphasised the need to restart discussions on the Free Trade Agreement (FTA) between India and the European Union, talks for which began in the year 2007.
In view of her medical condition, visiting German Chancellor Angela Merkel will not stand and remain seated when the National Anthems of India and Germany will be played at during a ceremonial reception at Rashtrapati Bhawan on Friday morning.