Muscat, Jan 16: India and Oman are looking at sealing a broad trade and investment pact this year that will cut tariffs on each other’s goods and boost the overall trade basket in line with renewed vigour in the relations, especially in the economic sphere.The negotiations for a comprehensive economic partnership agreement (CEPA) gained new momentum after Oman’s Sultan Haitham bin Tarik travelled to India over a year back.
Omani Commerce Minister Qais bin Mohammad Al-Yousef told PTI that Muscat is hopeful of concluding the ambitious trade pact with India this year that is expected to significantly expand the two-way trade and investment ties between the two countries.
There has been a major upswing in economic ties between the two countries in the last few years, with India emerging as one of the top trading partners of Oman.
India was the fourth largest market for Oman’s crude oil exports for the year 2023 after South Korea. India was also the third largest market for Oman’s non-oil exports in 2023 after Saudi Arabia.
“The comprehensive economic partnership agreement is still under negotiations,” the Omani Commerce Minister said.
“We already had several rounds of negotiations…we will see how it progresses,” Al-Yousef said in an interaction with a group of visiting journalists.
A fresh round of negotiations was held in New Delhi on January 13 and 14, and it is learnt that progress has been made on a number of areas.
Al-Yousef said Oman is keen to expand overall trade relations with India and that there is a lot of interest from Indian investors in Oman.
“We have several larger investors (from India) having shown interest in Oman and they are planning for the future,” he said, without elaborating.
Like Saudi Arabia, Qatar and the UAE, Oman is also looking at reducing its reliance on oil revenues by focusing on clean energy sources and promoting various other sectors in line with Oman’s ‘Vision 2040’.
The ‘Vision 2040’ is a roadmap for Oman’s economic and social development for the period of 2021-2040. It was approved by Sultan Haitham Bin Tarik in 2020 and then it was put into action in January 2021.
The Omani Commerce Minister also complimented India for its impressive economic growth in the last over 20 years, calling the “achievements” and economic growth rate “very impressive”.
“The people of India really worked hard to achieve economic growth. The growth in the digital transformation, science, technology and many other sectors,” he said.
Omani Sultan Tarik visited India in December 2023 during which he held extensive talks with Prime Minister Narendra Modi.
In their talks, the two leaders adopted a vision document to shore up bilateral engagement in 10 key areas.
The two sides had also announced the third tranche of USD 300 million for the Oman-India joint investment fund, which is a 50-50 venture between the State Bank of India and the Oman Investment Authority to channelise investments into the fastest growing sectors of the Indian economy.
According to the think-tank GTRI (Global Trade Research Institute), Indian goods worth USD 3.7 billion like gasoline, iron and steel, electronics, and machinery will get a significant boost in Oman if the trade deal is sealed.
Currently, over 80 per cent of its goods enter Oman at an average of 5 per cent import duties, a GTRI report has said.
Oman’s import duty ranges from 0 to 100 per cent, along with the existence of specific duties. A duty of 100 per cent is applicable on specific meats, wines and tobacco products.
Al-Yousef said the two sides will review the implementation of various decisions taken at the talks between the two leaders around a year back in a joint commission meeting soon.
Asked about the proposed India-Middle East-Europe Corridor (IMEEC), the Omani Commerce Minister said it is a well-come move as any connectivity project that eases transportation is helpful for trade to grow.
In terms of the corridor, any sort of corridor, if it eases business and trade, is always welcome, he said.
Billed as a pathbreaking initiative, the IMEEC envisages a vast road, railroad and shipping networks among India, Saudi Arabia, the United States and Europe with an aim to ensure integration among Asia, the Middle East and the West.
The IMEEC was firmed up on the sidelines of the G20 Summit in September last year in Delhi. An agreement was signed by India, Saudi Arabia, the European Union, the United Arab Emirates (UAE), the US and some other G20 partners for the corridor.