India, Oman sign Comprehensive Economic Partnership Agreement

India and Oman on Thursday signed a Comprehensive Economic Partnership Agreement, allowing free trade in goods and services between the two countries, thereby heralding a new era of economic partnership. The agreement expands opportunities for people of both countries while achieving a major milestone in India’s strategic engagement with the Gulf region.

The India–Oman Comprehensive Economic Partnership Agreement (CEPA) was signed by India’s minister of commerce and industry Piyush Goyal and Oman’s minister of commerce, industry and investment promotion, Qais bin Mohammed Al Yousef, in the presence of Prime Minister Narendra Modi and his Majesty Sultan Haitham bin Tarik.

A commerce ministry release, issued on Thursday, said the agreement opens up export opportunity for India’s traditional industry sectors, including textiles, leather, footwear, gems and jewellery, engineering products, plastics, furniture, agricultural products, pharmaceuticals, medical devices and automobiles, enhancing the already warm relations and generating employment potential in both countries.

The free-trade agreement ensures unprecedented zero-duty access for Indian goods on 98.08 per cent of Oman’s tariff lines, covering 99.38 per cent of India’s exports by value.

India has offered tariff reduction on 77.79 per cent of its 12,556 tariff lines, which covers 94.81 per cent of India’s imports from Oman by value.

Under the FTA, Oman has opened up 127 sub-sectors in the service sector, allowing 100 per cent direct investment by Indian companies in Computer related services, Business services, Professional services, Audio visual services, R & D services, Education services and Health services.

Oman imports $12.52 billion worth of services globally, of which imports from India account for just 5.31 per cent, which leaves enough potential for India’s services exports to that country.

The agreement has also enhanced mobility for Indian professionals with Oman committing to allow temporary visas for certain categories of intra-corporate transferees, and contractual service suppliers, business visitors and independent professionals in accountancy, taxation, architecture, medical and allied sectors, under liberalised entry and stay.

Oman has also committed to provide for future negotiations on social security coverage of workers upon implementation of Oman’s contributory social security system.

Under the FTA, Oman has opened up its health care sector for India’s traditional modes of patient care, becoming the first country to offer significant opportunities for India’s AYUSH and wellness sectors and promoting traditional health care system and health-related travel.

Indian pharma companies will also get faster access to Oman’s market with the fast-tracking of marketing authorisations for pharmaceutical products approved by major regulatory organisations such as USFDA, EMA and UKMHRA, while the acceptance of GMP inspection documents will help reduce time and cost for exporters.

India will facilitate acceptance of Oman’s Halal certification, while Oman will facilitate acceptance of India’s organic product (NPOP) certification with the enhanced cooperation in standards and conformity assessment.

Oman is home to nearly 7 lakh Indian nationals, including Indian merchant families living in that country for the past 200–300 years, and 6,000 Indian business establishments present across sectors. Bilateral trade between Oman and India stands at around $10 billion while Indians in Oman remit around $2 billion annually back home. The CEPA is the right destination for the two mutually dependent economies.

The CEPA also broadens India’s engagement with the Gulf region as Oman is an important gateway for Indian goods and services to the Middle East and Africa markets.