What’s behind India-Oman’s faster-than-expected CEPA?

India and Oman are moving faster than expected to unveil their Comprehensive Economic Partnership Agreement, with officials signaling an announcement within weeks. Oman has already begun translating the text into Arabic, and both capitals are lining up cabinet clearances, accelerating the timeline for signature.

Momentum reflects both political coordination and commercial urgency. Bilateral trade exceeded $10 billion in FY2024-25, dominated by petroleum and urea on the import side, while Indian exports crossed $4 billion. With a clear landing zone on tariffs and services, negotiators have kept the pace high since late 2023.

What shortened the timeline

Officials in New Delhi indicated the earlier two- to three-month estimate has been pulled forward, as both sides agreed to jointly announce the conclusion and signing. This synchrony reduced the usual delays at the end of negotiations and allowed procedural steps to occur simultaneously instead of one after the other.

The draft has advanced to Arabic translation, signaling that legal scrub and linguistic vetting are nearly complete. With cabinets primed for approval, the administrative path has fewer unknowns, enabling a quick turn from text finalization to public confirmation.

Did you know?
Oman’s ports provide proximate access to the Strait of Hormuz, a chokepoint for nearly a fifth of globally traded crude, amplifying the strategic value of a trade pact with India.

Trade fundamentals pushed urgency

Two-way trade topped $10 billion in FY2024-25, giving both sides strong incentives to lock in predictability. India imported $6.55 billion from Oman and exported $4.06 billion, underlining the potential gains from duty cuts and clearer market access.

Petroleum products and urea drive more than 70 percent of India’s imports from Oman. Tariff relief on these and related inputs can lower costs for downstream industries, while easing access for polymers, chemicals, and metals can smooth supply chains.

What the deal is expected to cover

The CEPA is expected to reduce or eliminate customs duties on most traded goods. It also aims to ease norms for services and encourage investment flows, with facilitation measures designed for quicker approvals and fewer procedural delays.

Rules on standards and customs cooperation are likely to be streamlined. That should help firms manage compliance and logistics better, improving reliability for time-sensitive shipments into and out of Omani ports.

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Strategic logic in the Gulf

India’s recent CEPA with the UAE offers a tested template for Gulf pacts, reducing design risk and accelerating scheduling talks. That experience helps compress timelines on chapters like goods, services, and dispute settlement.

Oman’s position near the Strait of Hormuz enhances its value in India’s Middle East strategy. The pact strengthens energy security and access to regional trade routes, with ports that can serve as resilient nodes for Indian exporters.

The last big hurdle: Omanization

Oman’s policy mandates quotas for hiring local nationals, a sensitive area for foreign employers. India has asked to keep current employment requirements unchanged for Indian firms, seeking certainty without disrupting local priorities.

Clarity on how exemptions or grandfathering would apply will shape service commitments and on-ground operations. A pragmatic clause could unlock faster deployment for Indian companies while aligning with Omani workforce goals.

What changes for businesses

Manufacturers can expect phased duty reductions and clearer rules of origin, improving cost planning and competitive pricing. Petrochemicals, metals, fertilizers, and plastics are among the sectors positioned for early gains once schedules take effect.

Services players could see simplified entry and recognition pathways, particularly in IT, professional services, and logistics. Investment chapters may add comfort to dispute resolution and approvals, aiding medium-term capital plans.

Outlook: From translation to signature

With translation and cabinet processes converging, the announcement window is near. If Omanization terms are settled cleanly, the CEPA can move from text to signature quickly, setting up an early wave of tariff relief and a deeper India-Gulf trade corridor.