India, Oman to sign free trade agreement tomorrow: Key expectations
What's the story
India and Oman are all set to sign a landmark free trade agreement (FTA) on Thursday in Muscat. The deal, officially called the Comprehensive Economic Partnership Agreement (CEPA), aims to strengthen the economic ties between the two nations. Prime Minister Narendra Modi will attend the signing ceremony during the final leg of his three-nation tour, after wrapping up visits to Jordan and Ethiopia.
Agreement details
CEPA negotiations began in November 2023
The talks for the CEPA started in November 2023 and were concluded this year. The agreement is expected to significantly reduce or eliminate customs duties on most goods traded between India and Oman. It will also ease norms to promote trade in services and attract investments, thereby boosting economic cooperation between the two countries.
Trade relations
Oman: India's 3rd-largest GCC export destination
Oman is India's third-largest export destination in the Gulf Cooperation Council (GCC) region. The two countries have a bilateral trade of around $10.5 billion, with India exporting goods worth $4 billion and importing products worth $6.54 billion from Oman in 2024-25. Major imports from Oman include petroleum products and urea, which account for over 70% of total imports.
Business expectations
Omani business leaders anticipate growth from CEPA
Ahead of Modi's visit, Omani business leaders have expressed optimism about the CEPA. Ajay Khimji, Director of the Khimji Ramdas Group, said that this agreement is a testament to their shared vision for the next century. He added it will act as a catalyst by removing barriers in trade, investment and services while providing certainty and scale for long-term commitments.
Economic impact
CEPA to transform Oman's business environment
Davis Kallukaran, Deputy Chairman of the Foreign Investment Committee at Oman Chamber of Commerce and Industry (OCCI), said that the CEPA would bring a major transformation in Oman's business environment. He noted that bilateral trade, currently around $10.5 billion, is expected to grow exponentially after the signing of this agreement due to removal of customs duties and trade barriers.