When the new OR12m ($31.2m) Maritime Museum in Sur opens its doors in 2025, visitors will be able to experience the narrative of Oman’s seafarers. For centuries, mariners journeyed far and wide, across the Arabian Sea to Africa, India and beyond. One of the principal sponsors of the museum is the Oman India Fertilizer Company (OMIFCO) – a $969m joint project between national energy firm OQ and India’s fertiliser companies IFFCO and KRIBHCO, and an affiliate of the Oman Investment Authority (OIA). In 2023 India was the sultanate’s fourth-largest source of imports, while Oman was India’s fourth-largest source of oil exports. The goods and services traded between the two countries will receive a boost from a new Comprehensive Economic Partnership Agreement (CEPA) that is under negotiation as of April 2025.
Described by the commerce ministers of both countries as a potentially transformative agreement, CEPA should have a positive impact on subsectors ranging from polymers and petroleum products to semiconductors and steel. Negotiations also come at a time of new impetus in bilateral and multilateral trade talks between Oman, GCC member states and third parties, as the world braces for potential, US-inspired tariff and trade disputes. Negotiations have also resumed on a long-delayed GCC-EU free trade agreement, as well as a GCC-UK deal. Both agreements should bring further benefits for Oman, as a leading trader with both blocs.
Facts & Figures
Historically, Oman has enjoyed a slight trade surplus with India. In FY 2023/24 India’s exports to Oman were worth some $4.47bn, while the Indian imports from the sultanate totalled $4.5bn.Some 70% of Oman’s exports to India consist of petroleum, petroleum products and urea. Other goods sold to India include ethylene polymers, propylene, pet coke, gypsum, chemicals, iron and steel.
India exports light oils and preparations, ships, boats and floating structures, aluminium, rice, machinery, aeroplanes and a wide variety of food and beverages. Additionally, there are over 6000 Indian-Omani joint ventures, with a total investment value of over $7.5bn. Cumulative foreign direct investment flow from Oman to India between 2000 and June 2024 was $597.1m.
Among the largest joint investments is the $969m OMIFCO project, which exports nearly its entire output of urea and ammonia to India. Indian companies are active in a wide range of other joint activities in the sultanate, from retail to green hydrogen. Additionally, the Oman-India Joint Investment Fund is a 50-50 joint venture between the State Bank of India and the OIA, the sultanate’s sovereign wealth fund. In December 2023 the fund disbursed a third tranche of some $300m in investment for the subcontinent.
Signing Up
In order to deepen bilateral relations further, the India-Oman Joint Commission has been working on a CEPA for an extended period of time. In January 2025 it held its 11th session in Muscat, where it was agreed to expedite the signing of the agreement. A fifth round of CEPA talks was also held in January. During talks, the two sides announced a new protocol to amend the India-Oman double taxation avoidance agreement, bringing double taxation regulations into line with international best practices and should further encourage bilateral trade and investment. Negotiations on CEPA had previously hit a roadblock in March 2024 over India’s market access offer for certain products. New Delhi had raised concerns over Chinese companies exploiting the CEPA to unload goods on Indian markets. With the international trading environment one of uncertainty following developments in the US, there is renewed impetus to resolve outstanding trade issues.
A CEPA would remove the current import duties on Indian goods landing in Oman, which range from 0-100% and average approximately 5%. This would benefit Omani consumers in particular, who would have to pay less for imported Indian electrical and electronics goods. It would also give Omani exporters and re-exporters more open access to 1.4bn potential customers.
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