India, Oman to enhance bilateral trade and generate employment

The India-Oman CEPA establishes a comprehensive framework covering trade in goods and services, investment, professional mobility, and regulatory cooperation, while maintaining a balanced approach to market access and safeguards — expected to boost bilateral trade, generate employment, strengthen supply chains, and support deeper and more sustained economic engagement between India and Oman, an official statement said on Saturday.

Trade and commerce have been a key pillar of bilateral cooperation between India and Oman, with both sides recognising the potential for further growth and diversification in bilateral trade.

During FY 2024-25, bilateral trade between the two countries stood at $10.61 billion, compared to $8.94 billion in FY 2023-24. Trade during the period April-October 2025 stood at $6.48 billion.

Under the CEPA, India secures 100 per cent duty-free market access for its exports to Oman, covering 98.08 per cent of Oman’s tariff lines and accounting for 99.38 per cent of India’s trade value, based on the average for 2022-23. All zero-duty concessions apply from the first day of the agreement’s entry into force, providing immediate certainty to exporters.

Presently, only 15.33 per cent of India’s export value and 11.34 per cent of tariff lines (2022-24 average) enters the Omani market at zero duty under the MFN (Most Favored Nation) regime. With CEPA, Indian exports to Oman that earlier faced duties of up to 5 per cent, valued at around $3.64 billion, are expected to gain significantly from improved price competitiveness.

The agreement opens export opportunities across engineering goods, pharmaceuticals, agriculture and processed food, marine products, textiles, chemicals, electronics, plastics, and gems and jewellery.

A calibrated liberalisation approach, including an exclusion list, protects sensitive sectors while supporting MSMEs, labour-intensive industries, and region-wide export growth, according to the official statement.

“With enhanced access to Oman’s import market of over $28 billion, supported by streamlined regulatory procedures, reduced compliance requirements, and faster market entry, Indian exporters are well positioned to expand their presence across multiple product segments,” it added.

At the same time, India has placed multiple tariff lines in the exclusion list. This move intends to protect key domestic sectors and sensitive value-chain industries and also safeguard manufacturing competitiveness and farmer interests.

Earlier Indian Prime Minister Narendra Modi’s visit to Oman in December 2025 has turned a traditionally steady Gulf partnership into a more ambitious, trade‑ and security‑focused relationship, crowned by the signing of the India–Oman Comprehensive Economic Partnership Agreement (CEPA). The trip also fits into New Delhi’s broader push to secure energy, diversify supply chains and deepen strategic footholds across West Asia and the western Indian Ocean.​

The visit came as the final leg of PM Modi’s three‑nation tour to Jordan, Ethiopia and Oman, timed with the 70th year of diplomatic ties between New Delhi and Muscat.​

For Oman, partnering more closely with India helps diversify beyond oil and gas and anchor itself to a large, fast‑growing Asian market.​

For India, Oman is a crucial Gulf partner for energy supplies, fertilisers and maritime access astride key sea lanes from the Strait of Hormuz down to the Arabian Sea.

According to the joint statement, both sides reviewed the entire spectrum of ties, from energy and trade to defence and maritime security.​

Defence and security: The two countries agreed to deepen joint exercises, training, high‑level defence exchanges and information‑sharing to counter piracy and other maritime crimes, with an emphasis on enhancing maritime domain awareness.​

Energy and renewables: New Delhi and Muscat signalled intent to move from a buyer–seller equation to joint investments and collaboration in exploration and production, as well as green hydrogen and green ammonia projects aligned with sustainable energy goals.​

Wider agenda: The visit also involved discussions on technology, agriculture, culture and people‑to‑people exchanges, including planned outreach to the sizeable Indian diaspora in Oman.​

The centrepiece of the visit was the signing of the India–Oman CEPA, a free trade agreement that both sides had negotiated since 2023 and politically cleared by India’s Cabinet just before the trip.​ New Delhi has pitched this agreement as “ambitious but balanced”, mixing aggressive market access with clear protections.​

Rules of origin: The deal includes strict rules of origin to prevent third‑country products, particularly from China, from being rerouted through Oman merely to exploit duty concessions into the Indian market.​

Agencies