Israel's foreign minister agreed Monday with his Bahraini counterpart to boost trade relations, during his first visit to one of the two Gulf Arab states to establish ties with Israel.

"The foreign minister and I agreed that we should work together to increase the number of direct flights, the tourism, the trade volume, the investment," Eli Cohen said during a ceremony to inaugurate Israel's new embassy.

The embassy in the capital Manama will replace the first embassy Israel opened in 2021, a year after it established diplomatic relations with Bahrain as part of the US-brokered Abraham Accords.

Under the accords, Israel also established ties with the United Arab Emirates and Morocco.

Monday's ceremony was attended by Bahraini Foreign Minister Abdullatif Al Zayani, who said the "new embassy assumes a pivotal role" in growing collaboration between the two countries.

Al Zayani said his talks with Cohen on Monday resulted in an agreement on advancing "relations across the broadest range of fields, including, economic, investment, trade and other areas."

Cohen arrived in Bahrain on Sunday, accompanied by a business delegation of more than 30 companies working in high-tech, logistics and real estate.

Earlier on Monday, he met Crown Prince Salman bin Hamad Al-Khalifa and discussed "the importance of advancing a free trade agreement and projects to connect youths in Israel and Bahrain", Cohen posted on X, formerly Twitter.

"We look forward to expanding the circle of peace and normalisation to other states in the area," he said.

Despite now having steady ties with Israel, Bahrain and the UAE have joined other Gulf Arab states in issuing a series of condemnations against it this year.

Raids on the Al Aqsa mosque in Jerusalem and the Jenin Palestinian refugee camp in the occupied West Bank were among Israeli moves that sparked a Gulf outcry.

However, Cohen's trip coincides with growing speculation about an impending normalisation deal between Israel and Saudi Arabia, which is not a signatory to the Abraham Accords.

Riyadh and Washington have held talks on Saudi conditions for progress on normalisation with Israel, according to people briefed on the meetings.

"There are more Arab and Muslim countries that have shown interest in taking a step forward in joining the peace circle," Cohen told a press conference in Manama, without naming them.

In Bahrain, Cohen also visited the US Navy's Fifth Fleet base where he discussed maritime security cooperation, according to a statement by US Naval Forces Central Command (NAVCENT).

The visit "underscores our expanding partnership with Israel", NAVCENT commander Vice-Admiral Brad Cooper was quoted as saying.