India-Oman FTA Expected To Be Signed in Jan 2024

New Delhi, Dec 27 (KNN) The negotiations for the Free Trade Agreement (FTA) between India and Oman are progressing rapidly, with indications pointing towards a potential signing in January 2024, as stated by a senior government official.

The FTA holds significant promise for various export sectors, including motor gasoline, iron and steel products, electronics, machinery, textiles, plastics, boneless meat, essential oils, and motor cars.

These goods currently face a 5 per cent import duty in Oman, as highlighted in a recent report from the think-tank GTRI.

However, the report added, about 16.5 per cent of Indian exports to Oman, valued at approximately USD 800 million, including items such as wheat, medicines, basmati rice, tea, coffee, and fish, already enjoying duty-free access, will not experience additional benefits from the agreement.

Presently, over 80 per cent of Indian goods entering Oman incur an average import duty of 5 per cent, according to the report. Oman's import duty structure ranges from 0 to 100 per cent, with specific duties applying, including a 100 per cent duty on certain meats, wines, and tobacco products.

The second round of talks for the Comprehensive Economic Partnership Agreement (CEPA), as the pact is officially named, concluded earlier this month in Muscat.

"With Oman, there is very good progress, and both sides are very eager to conclude this deal. It may be signed in January 2024," stated the official.

India stands to benefit from the potential export of various products, including light oils and preparations of petroleum, bituminous minerals, medicaments, parts and accessories for motor vehicles, iron ores and concentrates, ferrous products obtained by direct reduction of iron ore, and aluminum.

Oman holds a significant position as India's third-largest export destination among the Gulf Cooperation Council (GCC) countries.

On the import front, India's merchandise imports from Oman reached USD 7.9 billion in 2022-23. Key imports include petroleum products (USD 4.6 billion) and urea (USD 1.2 billion), constituting 73 per cent of total imports.

Oman's products, especially in sectors like oil and gas, petrochemicals, and certain types of manufactured goods, are poised to find a more accessible market in India post-implementation of the trade agreement, as per the GTRI report.

On the services side, the report indicates that India's service exports to Oman in 2022 were valued at approximately USD 2.8 billion, while imports stood at USD 0.2 billion. Oman's higher per capita income (USD 25,060) compared to India's (USD 2,370) could potentially drive demand for more diversified and higher-value goods and services from India.

(KNN Bureau)