India, Oman trade pact to come into force from June 1; Check what's inside

The India-Oman Comprehensive Economic Partnership Agreement (CEPA) came into force on June 1, 2026, granting Indian goods 100% duty-free access to Oman acros...

What Happened

The India-Oman Comprehensive Economic Partnership Agreement (CEPA) came into force on June 1, 2026, granting Indian goods 100% duty-free access to Oman across 98.08% of its tariff lines — with all zero-duty concessions applying from the very first day.
Nearly 99.38% of India's current export value to Oman becomes eligible for zero duties immediately, benefiting sectors including textiles, agricultural products, engineering goods, pharmaceuticals, marine products, and gems and jewellery.
Oman had previously levied duties of around 5% on several Indian goods including textiles; these are now eliminated under the CEPA.
In return, India has liberalised tariffs on 77.79% of its tariff lines covering approximately 95% of imports from Oman, while keeping sensitive sectors (dairy, tea, coffee, certain agricultural products, and bullion) out of the liberalisation schedule.
The services chapter opens Oman's market across 127 sub-sectors and allows 100% FDI by Indian firms in professional services, IT, healthcare, and education.

Static Topic Bridges

Tariff Lines and Tariff Liberalisation Schedules

A tariff line refers to a specific product category as defined in a country's customs schedule, typically at the 8-digit level of the Harmonised System (HS) code. When a country agrees to "liberalise" a certain percentage of tariff lines, it means duties on those product categories will be eliminated or reduced over a phased schedule. The percentage of tariff lines covered does not always directly correspond to the percentage of trade value covered — a country may exclude fewer tariff lines but exclude high-value products, impacting the effective coverage of the deal.

Oman grants 0% duty on 98.08% of its tariff lines, but critically this covers 99.38% of India's actual export value — indicating that even the small number of excluded lines are in product categories where India exports little.
India's liberalisation of 77.79% of tariff lines covers ~95% of imports from Oman — primarily driven by petroleum, LNG, and petrochemical imports from Oman.
Phased tariff elimination schedules are included for some product categories; the most-favoured Day One commitments cover the bulk of manufactured goods.
India's exclusion list protects sensitive agricultural products and items like gold/silver bullion and certain metal scrap.

Connection to this news: The broad Day-One tariff elimination structure means Indian exporters do not need to wait for a phase-in period — sectors like textiles and engineering goods gain immediate competitiveness in the Omani market from June 1.

India's Export Basket to the Gulf and Sector-Level Impact

India's merchandise exports to the Gulf region are dominated by engineering goods, gems and jewellery, petroleum products, chemicals, textiles, and pharmaceuticals. The Gulf market is particularly important for Indian small and medium enterprises (SMEs) in labour-intensive sectors like textiles, leather, and processed food. Trade agreements with Gulf nations amplify the competitiveness of these sectors by eliminating tariff costs that make Indian products more expensive than those from competitor countries already benefiting from bilateral pacts.

Engineering goods to Oman projected to grow to $1.3–1.6 billion by 2030 under the CEPA, driven by zero tariffs on machinery, iron and steel products, and motor vehicles.
Textiles previously faced ~5% duties in Oman; zero-duty access under the CEPA provides a direct price advantage over non-CEPA competitors.
Agricultural and marine products — including rice, meat, eggs, seafood — benefit from duty-free access, consolidating India's role as a food supplier to Oman.
Pharmaceutical exports, already strong, gain additional market access through both tariff elimination and services-side regulatory cooperation.

Connection to this news: The CEPA's Day-One liberalisation structure across these sectors means exporters can begin filing for preferential tariff treatment at Omani customs from June 1, immediately impacting pricing and order competitiveness.

India's CEPA Architecture: Gulf as a Strategic Priority

India has pursued trade agreements with Gulf nations as part of a broader strategy to deepen economic integration, secure energy supply chains, and formalise diaspora-linked economic flows. The India-UAE CEPA (signed May 2022, in force May 2022) was the first modern CEPA in India's trade architecture and set a template for rapid negotiation and comprehensive coverage. The India-Oman CEPA follows this model. Both agreements are part of India's ambition to eventually conclude a broader India-GCC FTA.

India-UAE CEPA (2022): India's bilateral trade with UAE crossed $85 billion in FY2024-25.
India-Oman CEPA (2025/2026): Second Gulf CEPA, covering a $10.61 billion bilateral trade relationship.
India-GCC FTA negotiations are ongoing — an agreement encompassing all six GCC members would represent the single largest trade deal India has ever concluded by geographic coverage.
The India-Middle East-Europe Economic Corridor (IMEC), announced in 2023, provides additional geopolitical context for India's Gulf trade architecture.

Connection to this news: The CEPA's implementation on June 1 is not an isolated event — it is the second building block in India's systematic Gulf trade architecture and a strategic complement to energy import diversification, the Indian diaspora's remittance economy, and India's role in the IMEC supply chain corridor.

Key Facts & Data

India-Oman CEPA signed: December 18, 2025; in force: June 1, 2026.
Oman offers 0% duty on 98.08% of tariff lines, covering 99.38% of India's export value.
India liberalises 77.79% of tariff lines, covering ~95% of import value from Oman.
Previous Omani duties on Indian textiles: ~5%; reduced to 0% from June 1.
India-Oman bilateral trade: $10.61 billion (FY 2024-25); Oman exports $6.55 billion to India, imports $4.06 billion from India.
Oman's services commitments: 127 sub-sectors opened; 100% FDI by Indian companies in select sectors.
This is Oman's first bilateral trade deal since the US-Oman FTA of 2006.
Engineering exports to Oman projected to reach $1.3–1.6 billion by 2030.
India's exclusions: dairy, tea, coffee, rubber, tobacco, gold/silver bullion, certain metal scrap.
Key export sectors benefiting: engineering goods, pharmaceuticals, textiles, marine products, processed food, gems and jewellery, chemicals, plastics.