India signs free trade deal with Oman: 98% exports will be tax-free – The Times of India

India and Oman have signed a trade deal, expanding the country’s strategic and economic ties in the Persian Gulf and helping exporters at a time when they are facing headwinds in several parts of the world.The Comprehensive Economic Partnership Agreement (CEPA), the second in West Asia after the one with the UAE a few years ago, will allow 98% of Indian exports to enter Oman duty-free, while India will remove tariffs on 77% of imports from the Gulf state, excluding sensitive items such as agricultural and dairy products, gold, oil and gas. Omani dates, marbles and some petrochemical products are zero-rated, but only for limited quantities. Indian exports to Oman stood at $4.1 billion in FY25, while imports stood at $6.6 billion.While in Oman 85% of products are subject to 5-6% duty, several food and other products face 100% tariffs, which will be eliminated when the agreement is implemented in the first quarter of 2026. India hopes to become the largest supplier of electronic goods to Oman, joining the UAE.

Service providers and professionals are expected to benefit from changes in visa rules, while CEPA will open up the AYUSH market to India, officials said. Further, Oman has agreed to accelerate approvals for Indian pharmaceutical products and will accept halal and organic food certifications from authorities here, making access easier. There is also a social security treaty on the anvil.CEPA was signed by Minister of Commerce and Industry Piyush Goyal and Qais bin Mohammed Al Yousef during Prime Minister Modi’s visit to Oman.

Positive impact of the pact between India and Oman has been felt for decades: Prime Minister Modi

The Comprehensive Economic Partnership Agreement (CEPA) was signed by Minister of Commerce and Industry Piyush Goyal and Oman’s Minister of Commerce, Industry and Investment Promotion Qais bin Mohammed Al Yousef during Prime Minister Modi’s visit to Oman. “Today we are taking a historic step forward in India-Oman relations, the positive impact of which will be felt for decades to come. CEPA will reinvigorate our ties in the 21st century,” Prime Minister said.“We see our exports growing by at least $2 billion (from the current $4 billion) in a short period of time, perhaps within a year or two,” the official said.Officials said domestic dairy producers will not only be able to compete more favorably with competitors from New Zealand and Denmark, but even Indian eggs, for which Oman is the largest market, will strengthen their hold. Similarly, Indian maritime products hit by US tariffs, automobiles, plastics and engineering goods are likely to see an uptick.While the talks started two years ago, they were at a standstill for a long time as Oman negotiated hard to get concessions on nearly 500 to 600 tariff lines. The country could manage to get benefits for about 18 to 20 items.

These include ten petrochemical products, polypropylene and polyethylene, as the government sought to protect the interests of Indian companies, especially at a time when more projects are planned in the country. While it agreed to import 2,000 tonnes of dates, a small quantity compared to the domestic production of 4-5 lakh tonnes, it managed to avoid reduction in tariffs on chocolate.The government also refused to make the same concessions as the UAE when it came to gold, oil and gas. India signed a trade pact with the UAE a few years ago, through which the country has boosted bilateral trade and also used the Gulf state as a hub for shipping goods to Africa. India is negotiating an agreement with Qatar while the country waits for clarity on talks with Saudi Arabia.Oman CEPA is part of a trade diversification strategy, especially after Trump’s 50% punitive measures hit Indian exports to the US, forcing the country to accelerate negotiations with a host of partners – from New Zealand to the EU and Chile. In recent months, India has implemented a free trade agreement with the four-nation European Free Trade Association and also signed the long-negotiated treaty with Britain, which will be implemented in 2026.