India and Oman Near Finalizing Free Trade Agreement Deal

05 Aug, 2024

India and Oman Near Finalizing Free Trade Agreement Deal

India and Oman are nearing the finalization of a significant trade agreement, with the Comprehensive Economic Partnership Agreement (CEPA) expected to be signed after the formation of a new Indian government. This deal aims to facilitate easier market access between the two countries, promising substantial economic benefits. The CEPA will eliminate duties on various Indian exports to Oman, including petroleum, textiles, electronics, pharmaceuticals, machinery, and iron and steel, enhancing trade relations and market access for both nations.

The agreement is strategically important for India due to Oman's proximity to the Strait of Hormuz, a key oil transit route, and its large Indian expatriate community. India seeks to lower tariffs on exports like rice, pharmaceuticals, and steel, while also improving professional access for Indian workers in Oman. Conversely, Oman aims to increase its market access for products such as downstream petroleum and fertilizers.

Bilateral trade discussions began in November 2023 and have advanced through multiple rounds, with trade between the two nations valued at $12.39 billion for the fiscal year 2022-23. Oman is a vital market for India within the Gulf Cooperation Council (GCC), with ongoing talks extending to space cooperation, green hydrogen, and renewable energy.