May 2, 2024
Oman is a gateway to the narrow Strait of Hormuz, a crucial transit point for global oil shipments positioned between Oman and Iran
With limited progress on a comprehensive deal with the Gulf Cooperation Council (GCC), India has shifted its focus towards pursuing individual agreements with GCC member states
As part of the deal, Oman has committed to waiving duties on Indian exports valued at approximately $3 billion annually
India has agreed to reduce tariffs on select petrochemicals, aluminium, and copper imported from Oman while imposing limits on the volume of such imports
India and Oman are poised to finalize a trade agreement in the upcoming months, according to statements from two Indian government officials. This move comes as New Delhi aims to bolster its connections in the Middle East, where escalating tensions jeopardise critical shipping lanes. An official emphasized the significance of this deal, stating that it would provide India with a strategic ally and access to vital trade routes in a region marked by volatility.
With annual trade between India and Oman at less than US$13 billion, forging stronger ties with the Gulf nation is strategic for India. Oman is a gateway to the narrow Strait of Hormuz, a crucial transit point for global oil shipments between Oman and Iran. The agreement, however, hinges on the approval of the winning government in India’s ongoing national elections, the results of which are slated for announcement in June.
With limited progress on a comprehensive deal with the GCC, India has shifted its focus towards pursuing individual agreements with GCC member states like Oman and the United Arab Emirates.
Moreover, the proposed pact with Oman is seen as providing India with a competitive advantage, especially as the GCC engages in negotiations for trade pacts with Pakistan and China. As part of the deal, Oman has committed to waiving duties on Indian exports valued at approximately US$3 billion annually, spanning various sectors, including agriculture, gems, automobiles, and textiles.
In return, India has agreed to reduce tariffs on select petrochemicals, aluminium, and copper imported from Oman while imposing limits on the volume of such imports. These developments underscore the growing economic cooperation between India and Oman, which aims to foster mutual prosperity amidst regional challenges.
Source: The Hindu