Cabinet clears India-Oman FTA ahead of PM Modi’s visit

India moved a step closer to sealing a major trade pact with Oman on Friday, with the Union Cabinet clearing the proposed India-Oman Comprehensive Economic Partnership Agreement (CEPA).

The agreement is expected to be signed during Prime Minister Narendra Modi’s visit to Muscat on December 17–18, senior government sources said. At a special briefing, Secretary (CPV & OIA) Arun Kumar Chatterjee said both sides were “very optimistic” about concluding the CEPA during the PM’s visit.

“Teams from both sides have been working very hard for its early finalisation. Several documents are in advanced stages of approval. We have immense faith that if the agreement is signed during this visit, it will significantly deepen economic ties between India and Oman, and open a new chapter in our trade and commercial relationship,” he said.

The pact, negotiations for which began in November 2023 and concluded earlier this year, seeks to reduce or eliminate customs duties on a wide range of goods, liberalise services, and strengthen investment flows. Oman is a longstanding strategic partner, and officials say the CEPA is expected to lock in market access, diversify supply chains, and boost India’s footprint in the Gulf and the wider Indian Ocean Region.

The FTA is set against the backdrop of the Prime Minister’s three-nation tour to Jordan, Ethiopia and Oman from December 15 to 18, described as a calibrated diplomatic outreach across West Asia and Africa.

Modi’s visit to Oman, which marks 70 years of diplomatic ties and follows Sultan Haitham bin Tarik’s State visit in 2023, will review cooperation in defence, maritime security, energy, technology, investment and food security. Regional developments in the Gulf and the Indian Ocean Region will also feature in talks.

Economic engagement between India and Oman has grown steadily. Bilateral trade touched $10.61 billion in FY 2024–25. India is Oman’s fourth-largest source of non-oil imports and its third-largest market for non-oil exports. Over 6,000 India-Oman joint ventures contribute $7.5 billion to Oman’s economy, while the Oman India Joint Investment Fund has deployed more than $320 million across Indian sectors, with a third tranche underway. Large Indian firms are present in Oman across green hydrogen, steel, manufacturing, IT, logistics and construction.

The relationship also has a strong people-to-people dimension. Nearly 6.8 lakh Indians reside in Oman, the majority holding work visas, and 22 Indian schools educate more than 48,000 students.

Officials said the CEPA would serve as a force multiplier for an already robust partnership, positioning India and Oman to expand commercial and strategic cooperation at a pivotal moment for the region.