New Delhi, Feb 22 (KNN) India and Oman are on the brink of solidifying a significant trade agreement, as officials from both nations engage in the meticulous process of legal scrutiny of the proposed free-trade agreement (FTA).

Sources close to the matter have revealed that the groundwork for this agreement has already commenced.

"The trade deal is nearing its conclusion, with the legal review of the FTA text currently underway," disclosed one of the individuals familiar with the negotiations to Business Standard.

India's urgency to seal this pact before the onset of the model code of conduct (MCC) preceding the general elections underscores the critical timing of this proposed agreement.

The announcement of the MCC, imminent at any moment, adds a sense of urgency to the negotiations.

This trade pact holds paramount importance for India as it aligns with its broader strategy of bolstering ties with Gulf nations, with Oman serving as a longstanding strategic partner, fostering trade relations dating back nearly 5,000 years.

Furthermore, Oman's membership in the Gulf Cooperation Council (GCC), comprising Bahrain, Kuwait, Oman, Qatar, Saudi Arabia, and the United Arab Emirates (UAE), amplifies the significance of this agreement.

While India has already inked a comprehensive FTA with the UAE two years ago, negotiations with the GCC as a whole await official launch.

India's withdrawal from the China-backed Regional Comprehensive Economic Partnership (RCEP) in 2019 has prompted a recalibration of its foreign trade approach.

In the past three years, India has inked FTAs with Mauritius, the UAE, and Australia, with negotiations underway for agreements with the United Kingdom (UK) and the European Free Trade Association (EFTA) nations ahead of the upcoming general elections.

The negotiations between India and Oman have progressed significantly since their formal commencement in November, with most chapters of the agreement text finalised by January.

Drawing from the successful India-UAE agreement, officials anticipate a smooth negotiation process with Oman.

Bilateral trade between India and Oman has exhibited robust growth, surging from USD 3.15 billion in FY22 to USD 4.48 billion in FY23, marking a substantial 42 per cent increase.

Petroleum products, particularly motor gasoline, constituted a significant portion of India's exports during the previous fiscal year.

On the import front, Oman remains a key trade partner, with imports surpassing exports, totalling USD 7.91 billion in FY23, reflecting a 15.6 per cent upsurge.

Primary imports include petroleum products and urea, constituting a significant portion of inbound shipments.

Despite attempts to seek clarification from the commerce department, responses remain pending, leaving stakeholders eagerly anticipating further developments in this burgeoning trade relationship.

(KNN Bureau)