India played a tough ball in the negotiations for the Comprehensive Economic Partnership Agreement (CEPA) protecting all the sensitive sectors and giving space in sectors where the opening up with other countries had led to unusual import surges of some products.
The negotiations on CEPA were launched in November 2023 and by March 2024 after three rounds of negotiations reached agreement on all components of the agreement. A cabinet proposal was also submitted for the pact but Oman wanted negotiations reopened.
After March 2024 Oman proposed further concessions on 600-700 tariff lines from India but after year-long talks India settled for liberalisation of 18 lines, an official said.
The 4th round (September 2024) and 5th round (13–14 January 2025) focused on revised offers. The time between the conclusion of talks and signing was also taken up by other formalities like legal scrubbing.
The official said at the start of the negotiations Oman had asked for concessions that India had given to the United Arab Emirates (UAE) in their CEPA. India refused.”UAE trade agreement was India’s first in the Gulf region and from it lessons had been learnt,” he added.
Protecting Bullion and Sensitive Agriculture
One impact of the CEPA was the routing of a large portion India’s imports of gold and silver from UAE using the lower duties provided in the agreement. In the pact with Oman gold and silver bullion and jewellery have been kept out of the agreement. Other sensitive sectors that India has obtained exclusion are agriculture products including dairy, tea, coffee, rubber, tobacco and labour intensive products like footwear, sports goods and scrap of base metals.
In all India has placed 2789 tariff lines in the exclusion list. Sectors where domestic capacity is developing like machinery for specialised industries, electrical and electronics equipment and precision goods strong protections have been maintained by India.
Market Access Equilibrium
India will open up 77% of its tariff lines for Oman that will cover 94% of its total exports by value to India. In return India has got zero-duty access on 98.08% of tariff lines, covering 99.38% of India’s exports to Oman.
Many of the imports like marble, dates and petrochemicals from Oman would be subject to quotas.