MUSCAT: India and Oman are inching closer to finalising a comprehensive economic partnership agreement (CEPA), aiming to boost bilateral trade and investment significantly. The ambitious pact, expected to cut tariffs and expand the trade basket, aligns with the growing economic collaboration between the two nations.
Discussions for CEPA gained momentum following Oman’s Sultan Haitham bin Tarik’s visit to India over a year ago. Omani Commerce Minister Qais bin Mohammad Al-Yousef expressed optimism about concluding the agreement within the year, noting its potential to strengthen economic ties further.
“The comprehensive economic partnership agreement is still under negotiations. We’ve had several rounds of discussions, and one more round is coming up,” Al-Yousef said, adding, “There is considerable interest from Indian investors in Oman, and several larger players are planning for the future.”
Economic ties between India and Oman have flourished in recent years, with India becoming one of Oman’s top trading partners. In 2023, India ranked as the fourth-largest market for Oman’s crude oil exports, trailing South Korea, and the third-largest market for non-oil exports after Saudi Arabia.
Oman’s clean energy initiative
Oman’s focus on reducing its reliance on oil revenues through clean energy initiatives and diverse sectoral growth under its ‘Vision 2040’ roadmap complements India’s growing economic presence. Approved by Sultan Haitham in 2020, the Vision 2040 plan aims to transform Oman’s economic and social landscape by 2040.
The Omani Commerce Minister also lauded India’s economic achievements over the past two decades, describing its growth in areas such as digital transformation, science, and technology as “very impressive.”
Sultan Haitham’s visit to India in December 2023 set the stage for deeper engagement. Extensive discussions with Prime Minister Narendra Modi culminated in a vision document to strengthen cooperation in 10 key areas. The two countries also announced the third tranche of $300 million for the Oman-India joint investment fund, a 50-50 venture between the State Bank of India and the Oman Investment Authority.
“The two sides will soon review the implementation of various decisions made during the leaders’ talks,” Al-Yousef said, highlighting the upcoming joint commission meeting.
IMEEC
On the proposed India-Middle East-Europe Corridor (IMEEC), Al-Yousef welcomed the initiative, emphasizing that enhanced connectivity benefits trade. Envisioned as a transformative project, the IMEEC will integrate road, rail, and shipping networks across India, Saudi Arabia, the US, and Europe to strengthen ties between Asia, the Middle East, and the West.
The IMEEC agreement, signed during the G20 Summit in Delhi last September, is seen as a pivotal step in reshaping global trade dynamics.
