India-Oman Free Trade Agreement Nearing Finalisation
The free trade agreement between India and Oman is expected to be announced soon, according to an official. The Comprehensive Economic Partnership Agreement (CEPA) text is currently being translated into Arabic, after which it will require cabinet approval from both nations. The pact aims to significantly reduce or eliminate customs duties on most goods, boosting bilateral trade, which stood at over $10 billion in 2024-25. Oman is India's third-largest export destination among Gulf Cooperation Council countries.
Unpacked:
India mainly imports petroleum products and urea from Oman, which together account for over 70% of its imports. Other imports include polymers, pet coke, gypsum, chemicals, and iron and steel. India's exports to Oman are more diversified, including machinery, textiles, cereals, and pharmaceuticals.
The agreement could strengthen India’s trade position within the Gulf region, given that Oman is already its third-largest export destination among GCC countries. Similar agreements with the UAE and ongoing negotiations with other Gulf states may encourage more regional integration and competitive trade ties.
India is accelerating free trade agreements to diversify export markets, counteract recent US tariffs on Indian goods, and protect key domestic sectors like agriculture. These agreements also aim to boost investment, reduce trade barriers, and respond to shifting global trade dynamics.
India and Oman have centuries-old ties, formalized with diplomatic relations in 1955 and upgraded to a strategic partnership in 2008. Their relationship is built on strong people-to-people links, robust trade, and defense cooperation, which the new agreement aims to further reinforce.