India and Oman signed the Comprehensive Economic Partnership Agreement (CEPA) on December 18, 2025, marking a landmark in bilateral economic ties. The agreement provides Indian exports with zero-duty access on 98.08% of Oman's tariff lines, covering 99.38% of India's exports by value. This near-universal market access targets labour-intensive sectors like textiles, gems and jewellery, leather, footwear, engineering goods, plastics, furniture, agriculture, pharmaceuticals, medical devices, and automobiles. Signed in Muscat during Prime Minister Narendra Modi's visit by Commerce Minister Piyush Goyal and Oman's Qais bin Mohammed Al Yousef in the presence of Sultan Haitham bin Tarik, the CEPA follows negotiations concluded earlier in the year. It positions Oman as India's latest Gulf partner after the UAE, enhancing diversification amid global trade uncertainties.

The CEPA eliminates tariffs progressively, with immediate zero duty on most lines, boosting competitiveness for Indian goods previously facing average 5% duties (up to 100% on select items). Bilateral trade reached over $10 billion in FY25, with potential for substantial growth through reduced barriers. India reciprocates by liberalising 77.79% of tariff lines, covering 94.81% of Omani imports, primarily via tariff-rate quotas for sensitive products like dates and petrochemicals. This balanced framework supports employment generation, MSMEs, artisans, and women-led enterprises while safeguarding core interests.

Services emerge as a major beneficiary, with Oman offering commitments across 127 sub-sectors, including IT, professional services, audio-visual, R&D, education, and health. India's current 5.31% share in Oman's $12.52 billion services imports signals untapped potential. The pact allows 100% FDI by Indian firms in key Omani services sectors via commercial presence. Enhanced professional mobility includes raising intra-corporate transferee quotas to 50% and extending contractual supplier stays to two years (renewable). Oman makes global-first commitments on traditional medicine, promoting India's AYUSH and wellness sectors.

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Investment facilitation and regulatory easing encourage deeper flows, building on over 6,000 Indian establishments in Oman and significant remittances. The agreement includes fast-tracked pharmaceutical approvals and mutual recognition for Halal and organic certifications.

This CEPA advances India's Gulf strategy, reinforcing energy security, strategic presence, and economic resilience. Expected implementation in early 2026 will catalyse trade, job creation, and innovation-driven partnerships. Leaders hailed it as a blueprint for shared prosperity rooted in historical trust. The pact aligns with Oman's Vision 2040 and India's Atmanirbhar Bharat, fostering inclusive growth across sectors. As bilateral engagement deepens, the CEPA promises sustained momentum in a vital regional partnership.

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