India-Oman CEPA comes into force: 99% of Indian exports get duty-free access

The India-Oman Comprehensive Economic Partnership Agreement (CEPA) entered into force on June 1, marking a major milestone in bilateral economic relations and opening a new chapter in trade, investment and services cooperation between the two countries.

The agreement provides duty-free access for 99.38 per cent of India's exports to Oman by value, covering 98.08 per cent of Oman's tariff lines. The government expects the pact to significantly boost exports, generate employment and strengthen India's economic integration with the Gulf region and East Africa.

The CEPA was signed in Muscat on December 18, 2025, in the presence of Prime Minister Narendra Modi and Sultan Haitham bin Tarik Al Said. The agreement became operational after both countries completed the required domestic procedures.

What the India-Oman CEPA offers

Under the agreement, Indian exporters will gain immediate duty-free access across 98.08 per cent of Oman's tariff lines, covering 99.38 per cent of India's exports by value.

Earlier, only 15.33 per cent of India's exports entered Oman duty-free under the Most Favoured Nation (MFN) regime. The agreement is expected to improve India's competitiveness in Oman's import market, valued at nearly USD 28 billion.

It also provides greater certainty for businesses through streamlined customs procedures, regulatory cooperation and measures aimed at reducing non-tariff barriers.

To mark the launch of the agreement, the first consignments availing preferential tariff benefits, including agriculture and gems and jewellery exports, were flagged off from Mumbai, Kolkata and Chennai.

Key sectors set to benefit

Several labour-intensive sectors are expected to emerge as major beneficiaries of the agreement. These include:

• Agriculture and processed foods
• Marine products
• Textiles and garments
• Gems and jewellery
• Pharmaceuticals
• Engineering goods
• Electronics
• Footwear
• Automobiles

Marine products such as shrimp, fish and cuttlefish will now enjoy duty-free access, replacing earlier import duties of up to 5 per cent. Similarly, tariffs on gems and jewellery have been eliminated, giving Indian exporters a competitive advantage in Oman's market.

The agreement is expected to benefit exporters across major manufacturing and agricultural states, including Gujarat, Maharashtra, Tamil Nadu, Andhra Pradesh and Uttar Pradesh.

Major boost for pharmaceuticals

The pharmaceutical sector is among the biggest gainers under the CEPA.

The agreement provides binding zero-duty access for medicines, vaccines and pharmaceutical ingredients exported from India to Oman. In addition, products already approved by regulators such as the US Food and Drug Administration (USFDA), European Medicines Agency (EMA), UK's Medicines and Healthcare products Regulatory Agency (MHRA) and Australia's Therapeutic Goods Administration (TGA) will be eligible for marketing authorisation in Oman within 90 days.

The move is expected to reduce compliance burdens and accelerate market entry for Indian drug manufacturers.

New opportunities for Indian professionals

Apart from goods trade, the agreement contains one of the most comprehensive services packages secured by India in the Gulf region.

Oman has offered market access commitments across 127 services sub-sectors, including information technology, healthcare, education, engineering, financial services, telecommunications and tourism.

The pact also enhances mobility for Indian professionals. Business visitors can stay in Oman for up to 90 days, independent professionals for up to 180 days and intra-corporate transferees for up to four years.

Dedicated commitments have been made for engineers, doctors, IT professionals, teachers and consultants, creating fresh opportunities for skilled Indian workers.

Safeguards for farmers and sensitive sectors

While expanding trade opportunities, India has protected several sensitive sectors from market access commitments.

Products such as dairy items, cereals, fruits, vegetables, edible oils, oilseeds, rubber, leather and spices remain excluded from tariff concessions. The government said these safeguards are aimed at protecting farmers, domestic industry and food security.

Trade ties expected to strengthen further

Oman is India's second-largest trading partner in the Gulf region and serves as a strategic gateway to the Gulf Cooperation Council (GCC) and East African markets through its ports at Sohar, Duqm and Salalah.

Bilateral trade between India and Oman rose to USD 11.18 billion in FY 2025-26 from USD 10.61 billion in FY 2024-25, reflecting growing economic engagement between the two countries.

With the CEPA now operational, both countries expect trade and investment flows to increase further in the coming years.

Commerce and Industry Minister Piyush Goyal said the agreement would create new opportunities for exporters, farmers, fishermen, MSMEs and professionals while helping Indian businesses integrate more deeply into regional and global value chains.