India Nears Trade Deal with Oman

Oman's location along the Strait of Hormuz makes it a crucial trade partner for India

February 27, 2024

New Delhi seeks lower tariffs on exports, including rice, pharmaceuticals, petroleum, and steel products

Negotiations include easing entry for Indian professionals like doctors, nurses, engineers, and skilled workers

Oman aims for improved access to downstream petroleum products, fertilisers, iron, and steel products

Oman is India's third-largest trade partner within the GCC nations

India and Oman are on the verge of finalising discussions on a trade deal, facilitating smoother access for goods and services into each other’s markets. This development further solidifies India’s presence in the Gulf region. While most issues in the comprehensive economic partnership agreement have been resolved, the talks are expected to conclude shortly, with a potential deal being formalised as early as March, insiders revealed on the condition of anonymity.

Despite being a smaller economy, Oman holds strategic importance for India due to its geographical location along the vital oil transit chokepoint, the Strait of Hormuz. Additionally, Oman hosts the fifth-largest population of Indian expatriates globally. New Delhi is seeking reduced tariffs on various exports to Oman, from rice and pharmaceuticals to petroleum and steel products. Negotiations also include discussions on facilitating entry for Indian professionals such as doctors, nurses, engineers, and other skilled workers.

In turn, Oman aims for enhanced access to goods like downstream petroleum products, fertilisers, iron, and steel products. Officials from India’s trade ministry and the Omani government were unavailable for immediate comments. The urgency in finalising the trade pact, initiated just three months ago, underscores Prime Minister Narendra Modi’s commitment to strengthening ties with the Middle East. India has previously inked a free trade agreement with the United Arab Emirates and is actively engaged in trade deal discussions with the Gulf Cooperation Council. Oman is India’s third-largest trade partner within the GCC nations, with bilateral trade reaching US$ 12.38 billion in 2022-23

Sultan Haitham bin Tarik’s visit to India in December marked the first by an Omani ruler in over two decades. Following the visit, Oman allocated an exclusive zone at the strategically positioned Duqm port for India’s commercial cargo and warships docking. Prime Minister Modi’s government has been expediting trade talks with major partners, including the UK, the European Union, and the European Free Trade Association, encompassing Switzerland, Norway, Iceland, and Liechtenstein.

Source: Economic Times

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