India’s Commerce Ministry described the agreement as an export opportunity for India’s Labour-Intensive Sectors like textiles, leather, footwear, gems & jewellery, engineering products, plastics, furniture, agricultural products, pharmaceuticals, medical devices, and automobiles. Bilateral trade stands at over $10 billion currently, with strong potential for expansion under the CEPA framework.
Nearly 7 lakh Indian nationals reside in Oman, including Indian merchant families with a presence of over 200–300 years, with annual remittances of around $2 billion. Over 6,000 Indian establishments operate across sectors in the West Asian country. The agreement is part of India’s strategy to sign trade agreements with developed economies that don’t compete with its labour-intensive interests as well as provide opportunities for businesses.
Oman has offered zero-duty access on 98.08% of its tariff lines, covering 99.38% of India’s exports to Oman. All major labour-intensive sectors, including Gems & Jewellery, Textiles, leather, footwear, sports goods, plastics, furniture, agricultural products, engineering products, pharmaceuticals, medical devices, and Automobiles, receive full tariff elimination. Out of the above, immediate tariff elimination is being offered on 97.96% of Tariff Lines.
India is offering tariff liberalisation on 77.79% of its total tariff lines (12,556), which covers 94.81% of India’s imports from Oman by value. For the products of export interest to Oman and which are sensitive to India, the offer is mostly a tariff-rate quota (TRQ)-based tariff liberalisation.
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To safeguard its interest, sensitive products have been kept in the exclusion category by India without offering any concessions, especially agricultural products, including dairy, tea, coffee, rubber, and tobacco products; gold and silver bullion, jewellery; other labour-intensive products such as footwear and sports goods; and scrap of many base metals.
With India’s export share in Oman’s global imports basket at 5.31% out of the latter’s global services imports of $12.52 billion, India’s Commerce Ministry has projected significant untapped potential for Indian service providers in sectors like Computer Related Services, Business and Professional Services, Audio-visual Services, Research and Development, Education and Health Services to promote high-value job creation and support commercial engagement between both countries.
For the first time, Oman has offered wide-ranging commitments like an increase in quota for Intra-Corporate Transferees from 20% to 50%, with a longer permitted duration of stay for Contractual Service Suppliers extended from the existing 90 days to two years, and the possibility of a further two-year extension.
The agreement also provides for more liberal entry and stay conditions for skilled professionals in key sectors such as accountancy, taxation, architecture, medical and allied services to support deeper and more seamless professional engagement.
The CEPA provides for 100% Foreign Direct Investment by Indian companies in major service sectors in Oman through commercial presence. Both sides have also agreed to hold future discussions on social security coordination once Oman’s contributory social security system is implemented to facilitate labour mobility and worker protection. In a first, Oman’s commitment to Traditional Medicine has extended across all modes of supply, thus creating significant opportunities for India’s AYUSH and wellness sectors.
Provisions in the CEPA also address non-tariff barriers persisting despite tariff concessions, which limit real market access. This is the first bilateral agreement that Oman has signed with any country since the United States of America in 2006.
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