Indian police have confirmed the blast, saying there were no casualties, Times of India reported.
While initial reports said there were no injuries to people in the vicinity, the impact of the explosion shattered the windshields of 4-5 cars and police have cordoned off the site.
Police have blocked off roads outside the Israeli embassy following an explosion. There are no reported injuries to diplomatic staff.
The explosion took place less than 2km away from the ceremony attended by Indian Prime Minister Narendra Modi and President of this country.
The area where the explosion took place is one of the places that is always under strict security measures.
Preliminary reports indicate that a large number of vehicles parked near the Israeli embassy in Delhi were damaged in the blast.
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