Israel and Turkey have reached a deal to normalize diplomatic ties, officials in both countries said Monday, six years after an acrimonious rupture between the historic allies.

The relationship went into a tailspin in 2010, when Israeli naval commandos raided an aid flotilla on the Mediterranean Sea as it headed to the blockaded Gaza Strip. Nine Turkish nationals were killed in the incident on the ship Mavi Marmara.

In response, Turkey recalled its ambassador to Israel and scaled back military cooperation with its key non-Arab partner in the Middle East.

Under the deal finalized Sunday in Rome, Israel met Turkey's demand to compensate the families of Turkish casualties by contributing 20 million dollars to a victims' fund.

Ankara, in turn, will drop criminal charges against Israeli soldiers involved in the Mavi Marmara affair.

Turkey will also be allowed to deliver humanitarian aid to Gaza and invest in infrastructure projects there.

Gaza is controlled by the Islamist Hamas movement, which calls for the destruction of Israel.

"Along with new residential buildings, we will complete the construction of a 200-bed hospital in Gaza," a Turkish official said on condition of anonymity ahead of the agreement's official announcement later Monday in Rome.

In addition to the hospital, Turkey was also given the go-ahead to construct a new power plant and projects to tackle Gaza's water crisis.

Turkey would launch industrial projects in the West Bank as well, officials said.

"The agreement represents a diplomatic victory for Turkey, which assumed a principled and determined stance after the Mavi Marmara attack," said the Turkish official.

Israeli Prime Minister Benjamin Netanyahu and a delegation of aides were in Rome, where Netanyahu met with US Secretary of State John Kerry on Sunday and Monday.

"I updated Secretary Kerry about our agreement with Turkey," Netanyahu told reporters in the Italian capital on Monday.

The prime minister called it an "important step" with "immense implications for the Israeli economy."

Both Turkey and Israel are US allies, and Washington has been keen to see the governments reconcile. In 2013, Netanyahu, under pressure from the Obama administration, expressed regret for the loss of life on the aid flotilla.

Kerry said he welcomed the reconciliation.

"We also talked about the progress being made - the significant progress being made - by the prime minister in his discussions with Turkey, and we obviously have been encouraging a movement towards the resolution of the differences between Turkey and Israel," Kerry said alongside Netanyahu.

But in Israel, critics were quick to slam the deal.

A former minister, Gideon Sahar, tweeted that it was a "national humiliation" that Israel was agreeing to pay millions into a compensation fund for the families of the nine Turkish nationals killed.

But Netanyahu supporters praised the deal for succeeding in getting Turkey to withdraw lawsuits against the Israeli soldiers at the International Criminal Court in The Hague.

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