Goyal, Omani Minister discuss proposed FTA, trade & investment ties

Commerce & Industry Minister Piyush Goyal held an “engaging and excellent” meeting with his Omani counterpart Qais bin Mohammed Al Yousef in Muscat on Monday which may provide momentum to the India-Oman free trade agreement negotiations.  India, however, may remain measured in its responses to demands from Oman for greater market access in sensitive areas to avoid problems of import surges it encountered following its free trade agreement with the UAE, a source tracking the matter told businessline.

“Began my Oman visit with an engaging and excellent meeting with HE Qais bin Mohammed Al Yousef, Oman’s Minister of Commerce, Industry and Investment Promotion. Our talks focused on advancing negotiations on the Comprehensive Economic Partnership Agreement (CEPA), strengthening trade and investment ties, and exploring avenues to further deepen our bilateral partnership,” Goyal tweeted on Monday. More deliberations on trade and investment, including the CEPA (formal name for the FTA), will follow with the Joint Commission meeting, led by Goyal and Al Yousef, scheduled on Tuesday. The Minister is also expected to meet Sultan bin Salim Al Habsi, Minister of Finance & Chairperson of the Ministerial Committee for CEPA, which may provide further direction to the talks.

“This visit underscores the importance that India attaches to its trade and investment ties with Oman, one of India’s important trading partners in the  Gulf Cooperation Council (GCC) with bilateral trade estimated at over $8.94 billion in 2023-2024,” according to the Commerce Department.

The India-Oman CEPA negotiations, which began in November 2023, took off well and both sides were optimistic of wrapping up the talks by the first half of 2024. The negotiations, however, stalled in its final leg reportedly over differences between the two sides on certain market access demands from Oman that India was not able to accept. This  included demands for lower tariffs for some petrochemical products. “Since India recently faced the problem of a surge in imports of precious metals and some food items from the UAE following its FTA with the country, negotiators are very careful about what they agree to with Oman,” the source said.

India’s key imports from Oman comprise petroleum products and urea. Other imports include propylene and ethylene polymers, pet coke, gypsum, chemicals, and iron and steel. India’s main exports to Oman include petroleum products, iron and steel, rice (particularly basmati), processed minerals, ships, boats, and floating structures, electrical machinery, machinery parts, tea, coffee, spices, fruits and meat products.