New Delhi, June 1 (PTI) The free trade agreement between India and Oman came into force on Monday, giving duty-free access to 99 per cent of India's exports, including textiles, engineering, gems and jewellery, to the Omani market and benefiting professionals with enhanced mobility provisions.

On the other hand, Indian consumers would get cheaper Omani dates as imports of the fruit will enjoy quota-based duty concessions under the agreement.

The implementation of the comprehensive economic partnership agreement (CEPA) is a key development as Indian exporters are facing difficulties in shipping goods to the Gulf nation due to the US-Iran war.

The six Gulf nations are Oman, Bahrain, Kuwait, Qatar, Saudi Arabia and UAE.

India has granted duty concessions on 77.79 per cent of its total tariff lines (12,556), which covers 94.81 per cent of India's imports from Oman by value.

For products of export interest to Oman and those sensitive to India, the offer is mostly a tariff-rate quota (TRQ) based tariff liberalisation, which includes products like dates, marbles and petrochemical items.

The Comprehensive Economic Partnership Agreement (CEPA) 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.

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

"With 99.38 per cent of India's exports receiving duty-free access, the agreement unlocks new opportunities for our exporters and professionals to gain opportunities. Oman is our trusted partner, a bridge for our people and a gateway to the Gulf and East Africa," Commerce and Industry Minister Piyush Goyal said on Monday .

By delivering significant benefits to labour-intensive sectors, the pact will support job creation, drive investment and enable Indian enterprises to compete on an equal footing with suppliers from countries enjoying preferential market access, he said.

Bilateral trade between India and Oman reached USD 11.18 billion in FY 2025-26, up from USD 10.61 billion in FY 2024-25.

The minister added that the agreement is expected to significantly boost MSMEs, manufacturing and employment by enhancing competitiveness in labour-intensive sectors such as gems and jewellery, textiles, leather, footwear, marine products, engineering goods, processed foods and pharmaceuticals. The labour-intensive goods were earlier facing 5 per cent duty in Muscat. Oman import duty ranges between 5-100 per cent.

Oman's strategic logistics hubs at Sohar, Duqm and Salalah provide Indian exporters enhanced access to wider GCC and East African markets.

All zero-duty concessions come into effect immediately, providing certainty and competitiveness to Indian exporters.

Earlier, under the MFN (most favoured nation) regime, only 15.33 per cent of India's exports entered Oman duty-free. With CEPA, Indian exporters gain substantial price competitiveness in Oman's nearly USD 28 billion import market.

To safeguard the interests of farmers and MSMEs, India has decided not to give any duty concessions in sectors like agricultural products, gold and silver bullion, jewellery, footwear, sports goods, scrap of many base metals, dairy products, cereals, fruits, vegetables, edible oils, oilseeds, rubber, leather, and spices.

On pharma, the pact provides binding zero-duty access for medicines, vaccines and pharmaceutical ingredients pharmaceutical ingredients including penicillins, streptomycins and tetracyclines.

Oman's pharmaceutical market was valued at USD 302.84 million in 2025 and is projected to reach USD 473.71 million by 2031 (CAGR 6.6 per cent), presenting a significant and growing opportunity for India's pharmaceutical exporters.

Products approved by the USFDA, the European Medicines Agency, the UK's Medicines and Healthcare products Regulatory Agency, and Australia's Therapeutic Goods Administration will qualify for marketing authorisation within 90 days without prior inspection and with a 270-working-day target where inspections are required.

Acceptance of GMP (Good Manufacturing Practices) and inspection reports significantly reduces compliance burdens and accelerates market entry for Indian pharmaceutical exporters.

Further Oman imported about USD 1.7 billion worth of electronics products in 2025, presenting significant opportunities for Indian manufacturers.

India's electronics exports to Oman stood at USD 146 million, a significant gap that the CEPA's full tariff certainty, covering all electronics categories including boards and cabinets, static converters and TV reception apparatus, is designed to close.

On the services sector front, Oman has offered to extend substantial commitments across a broad spectrum of sectors, including computer-related services, business and professional services, audio-visual services, research and development, education and health services.

Bilateral services trade stood at USD 863 million in 2024, with India running a surplus of USD 447 million. Oman's global services imports amounted to USD 12.52 billion, while India accounted for only 5.31 per cent of these imports, indicating significant untapped potential.

For the first time, Oman has offered wide-ranging commitments under Mode 4 (movement of skilled professionals), including a notable increase in the quota for intra-corporate transferees from 20 per cent to 50 per cent, together with a longer permitted duration of stay for contractual service suppliers - extended from the existing 90 days to two years, with the possibility of a further two-year extension.

The enhanced mobility provisions will benefit nearly 6,000 India-Oman joint ventures.

As per the deal, business visitors can stay in Oman for up to 90 days; Independent professionals for up to 180 days; Intra-Corporate Transferees (ICTs) for up to 4 years.

These provisions provide clear, legally enforceable mobility pathways for India's professional workforce.

In addition, both sides have agreed to hold future discussions on the social security pact. It will provide reciprocal continuity of social security benefits and help avoid dual contributions for Indian workers and employers in Oman.

This is fifth trade pact implemented in the last five years. The earlier ones include the UAE, Mauritius, EFTA, and Australia.

This is the first bilateral agreement that Oman has signed with any country since its pact with the US in 2006. Oman is the third-largest export destination for India among the GCC countries.

India-Oman bilateral trade was about USD 10.5 billion (exports USD 4 billion and imports USD 6.54 billion) in 2024-25. The pact is expected to help an additional USD 2 billion in the next 2-3 years. Nearly 7 lakh Indian nationals reside in Oman, and India receives about USD 2 billion in remittances from Oman annually.

Indian enterprises have built a strong presence in Oman, with over 6,000 establishments operating across sectors. India has received USD 615.54 million in foreign direct investment from Oman between April 2000 and September 2025.

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