Will the India-Oman CEPA Enhance Exports and Energy Security?
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Synopsis
The Comprehensive Economic Partnership Agreement (CEPA) between India and Oman is set to significantly enhance India's export competitiveness and energy security while strengthening economic ties. This landmark agreement allows zero-duty access on most tariff lines, promising to boost trade for India's labor-intensive sectors.
Key Takeaways
- CEPA enhances export competitiveness
- Zero duty access on tariff lines
- Focus on labor-intensive MSMEs
- Boosts service commitments
- Strengthens India-Oman economic ties
New Delhi, Dec 20 (NationPress) The Comprehensive Economic Partnership Agreement (CEPA) with Oman is anticipated to significantly improve India's export competitiveness, ensure energy supplies at advantageous prices, and strengthen economic relations between India and Oman, according to a report released on Saturday.
The report from Bank of Baroda indicates that CEPA is designed to broaden trade and investment, augment export prospects for labor-intensive sectors within the micro, small, and medium enterprises (MSMEs), including textiles, leather, footwear, gems, jewelry, and engineering products.
Moreover, it intends to enhance commitments in services like education, health, computer, business, professional, and research & development services.
"This represents a pivotal step towards enhancing access to global markets and improving export competitiveness," the bank noted.
Under this agreement, zero duty access on 98.08% of Oman’s tariff lines for Indian products will be permitted, while India will provide zero duty on 77.79% of its tariff lines.
In FY25, India's exports to Oman reached $4.1 billion, accounting for roughly 0.9% of total exports, with an impressive five-year compound annual growth rate of 12.4%, compared to 6.9% for overall exports.
This agreement will help decrease India’s oil import expenses and explore more options in the future, with the major sectors highlighted in the agreement making up approximately 39% of India’s exports to Oman.
“This is beneficial for India’s overall export portfolio during a time when some exports are being rerouted to capitalize on cost advantages amid higher tariff rates imposed by the US,” the report elaborated.
The bank emphasized that the zero-duty agreement encompasses 99.38% of India’s exports to Oman by value and 94.81% of India’s imports from Oman by value. For products sensitive to export regulations, liberalization mainly occurs through tariff-rate quotas, which allow specific quantities of certain products to be imported, primarily affecting agriculture.
Point of View
I see the India-Oman CEPA as a strategic initiative that not only enhances India's export capabilities but also fortifies our energy security. This agreement is a crucial step towards fostering stronger economic ties and adapting to the shifting dynamics of global trade.
NationPress
20/12/2025
Frequently Asked Questions
What is the CEPA between India and Oman?
The Comprehensive Economic Partnership Agreement (CEPA) between India and Oman aims to enhance trade and investment, improve export competitiveness, and secure energy supplies.
How will CEPA affect Indian exports?
CEPA is expected to significantly boost India's export competitiveness, particularly in labor-intensive sectors such as textiles and engineering products.
What benefits does the CEPA provide for energy security?
The agreement will help India secure energy supplies at favorable prices, reducing the oil import bill and exploring future options.
