How the India-Oman CEPA Will Transform MSMEs and Services Exports

MUMBAI: The All India Association of Industries (AIAI) has applauded the signing of the historic Comprehensive Economic Partnership Agreement (CEPA) between India and Oman. This agreement marks a new chapter in India’s trade relations with the Gulf Cooperation Council (GCC) region. The CEPA was signed in Muscat during the official visit of Hon’ble Prime Minister Shri Narendra Modi and is set to unlock unprecedented opportunities for Indian exporters, particularly in the labour-intensive and MSME sectors.

The President of AIAI, Dr. Vijay Kalantri, who is also the Chairman of the World Trade Centre Mumbai, welcomed the signing of the pact, stating, “The India-Oman CEPA is a landmark milestone that will serve as a force multiplier for India’s manufacturing and services sectors. By securing zero-duty access for over 99% of Indian exports, the government has provided a substantial competitive edge to our MSMEs and exporters in textiles, gems & jewellery, engineering, and pharmaceuticals. Oman is not just a key trading partner but a strategic gateway for Indian businesses to access the wider markets of the GCC, Africa, and the Middle East.”

Dr. Kalantri added, “This agreement goes beyond trade in goods; it commits to the liberalization of service sectors and the facilitation of professional mobility, allowing Indian talent to contribute significantly to Oman’s development. We foresee bilateral trade surpassing its current trajectory to reach new heights in the coming years.” The agreement eliminates duties on 98.08% of Oman’s tariff lines and gives 100% commitment on FDI for Indian companies in major service sectors. This will bring immediate relief and competitiveness to labour-intensive sectors, manufacturing, engineering, services, and investment.

Notably, this is Oman’s first bilateral agreement since 2006 and India’s second FTA in the last 6 months, showcasing the country’s increasing willingness to integrate into global markets. The agreement is expected to have a significant impact on India’s trade relations with the GCC region and beyond.