India-Oman Comprehensive Economic Partnership Agreement Takes Effect, Projected to Boost Exports to $7 Billion Within Two Years

India-Oman CEPA Comes into Force, Boosting Exports and Economic Integration

The India-Oman Comprehensive Economic Partnership Agreement (CEPA) has come into effect on June 1, providing duty-free access for 99 percent of Indian exports to the Gulf nation. This move is expected to significantly boost exports and deepen economic integration between the two countries.

Immediate Boost to Exports

According to a government official, more than 10 consignments are being shipped to Oman, availing preferential duty access from various regions and sectors of India. The official also stated that the agreement is expected to provide an immediate boost to exports, with a short-term upside of $3 billion. In the long term, exports are expected to reach $7 billion within a year or two.

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Trade Statistics

Key Provisions

Under the agreement, India will secure duty-free access for 99.38 percent of its exports to Oman by value, covering 98.08 percent of Oman's tariff lines. Prior to the CEPA, only 15.33 percent of India's exports entered Oman duty-free under the most-favoured nation regime.

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Strategic Significance

The pact is expected to significantly improve the competitiveness of Indian products in Oman's nearly $28 billion import market, benefiting sectors such as textiles, engineering goods, gems and jewellery, chemicals, food products, and pharmaceuticals. Oman is India's second-largest trading partner in the Gulf region and serves as a strategic gateway to the wider Gulf Cooperation Council (GCC) and East African markets through its logistics and port infrastructure.

Protection for Sensitive Sectors

To protect sensitive domestic sectors, India has kept 2,789 tariff lines in the exclusion list, including dairy products, certain agricultural goods, and select petroleum products. On the import side, India has offered tariff liberalization on 77.79 percent of tariff lines, covering 94.81 percent of imports from Oman by value.

Future Prospects

The launch of the Oman CEPA comes as India accelerates negotiations on a series of trade agreements aimed at boosting exports and integrating domestic industry into global value chains. The government expects to reach $1 trillion in overall exports in the current year and $2 trillion in five years. India is negotiating trade agreements with Israel, Canada, and Chile, among others, and has received expressions of interest for trade agreements from Mexico and Ecuador.