The Union Cabinet on Friday approved the India-Oman free trade agreement that is expected to be signed during Prime Minister Narendra Modi’s visit to that country from December 17-18.The draft of the Comprehensive Economic Partnership Agreement (CEPA) was approved by the lower house of Parliament of Oman on Wednesday.
Modi will be visiting Oman as part of his three-nation visit from December 16 to 18. He will first visit Jordan and then Ethiopia before landing in Oman.
Negotiations conclude after five rounds
India and Oman launched CEPA negotiations in November 2023. After three rounds of intensive negotiations (Nov 2023–Mar 2024), both sides reached agreement on all CEPA components, including text and market access offers.
A Cabinet proposal submitted in March 2024 was deferred, prompting further renegotiations. The 4th round in September 2024 and 5th round from 13–14 January 2025 focused on revised offers.
“Following approval of the competent authority, the Draft Cabinet Note for signing and ratification was circulated to relevant Ministries. Both sides are now in the process of securing internal approvals,” ministry of commerce and industry had said Wednesday. All approvals are now in place for the signing of the pact.
Key Benefits
With the CEPA, India will get access to 98% of its products in Oman and significant access in services. Oman’s import duty ranges from 0 to 100% along with the existence of specific duties. 100% duty is applicable on specific meats, wines and tobacco products. Other than trade investment flows between the two sides are also expected to benefit from the agreement.
Oman is the third largest export destination among the Gulf Cooperation Council (GCC) countries. The bilateral trade between the two countries stood at $ 10.6 billion with India’s exports at $ 4.0 billion and imports at $ 6.5 billion.
The key exports from India include light oils and preparations, aluminum oxide, rice, machinery and mechanical appliances, electrical machinery and equipment as well as beauty and make-up preparations, plastics, iron and steel and ceramic products.
Crude petroleum oil and liquefied natural gas (LNG) account for a significant portion of imports. . Other major imports include urea, organic chemicals and sulphur.