India-Oman FTA may be signed in January 2024: Govt sources

The proposed Free Trade Agreement (FTA) between India and Oman is likely to be finalised in January 2024. Government sources have indicated that the negotiations are on track and both sides have already agreed on most of the text of the chapters of the proposed Comprehensive Economic Partnership Agreement (CEPA). The second round of talks for the proposed pact was concluded earlier this month in Muscat.

Bilateral trade between India and Oman in FY 2022-23 amounted to $12.39 billion. India's exports to Oman have increased from $2.25 billion in FY 2018-19 to $4.48 billion in FY 2022-23.

Describing Oman as one of the most reliable and steadfast partners of India in West Asia, former Indian Ambassador Ashok Sajjanhar has welcomed the trade talks stating that stronger bilateral, political, strategic and economic relations are beneficial not just for the people of India and Oman but also for peace, security and prosperity of the region.

Oman is a part of the 6-member Gulf Cooperation Council (GCC), which also comprises Bahrain, Kuwait, Qatar, Saudi Arabia and the UAE. Among the GCC countries, Oman is the 3rd largest export destination for Indian products and services. Currently, 80% of Indian products attract a 5% import duty.

India already has a trade agreement with the UAE, and Oman is likely to become the second GCC member to have a trade agreement with India. Negotiations between India and the GCC are yet to be concluded for an FTA.

Sajjanhar, terming a stronger possibility of an earlier FTA with Oman compared to the GCC, said that both nations can look at the model of the India-UAE FTA to arrive at an early decision on this important subject.

However, he added that an FTA with the GCC would have significance and importance larger than the sum of the individual member countries, irrespective of the possibility of other GCC members signing a separate FTA with India.

Describing a potential trade pact with Oman as a mutual win-win proposition, former Indian Ambassador Anil Trigunayat said that there's tremendous scope for the expansion of equitable market access by the institutionalisation of trade under the rubric of CEPA.

Pointing out that the existing CEPA with the UAE has already proven its efficacy, he said that another trade pact with Oman could eventually serve as a format for the India-GCC FTA.