- Why in news
- The India–Oman Comprehensive Economic Partnership Agreement (CEPA) entered into force on 1 June 2026, after being signed in Muscat on 18 December 2025. The first consignments using preferential tariffs were flagged off.
- What it is
- The India–Oman CEPA is a bilateral trade pact covering goods, services, professional mobility, investment facilitation and regulatory cooperation. It goes beyond tariff cuts. Oman is a gateway to the wider Gulf (GCC) and East African markets through its ports.
- India's offer
- India liberalises 77.79% of tariff lines, covering 94.81% of imports from Oman by value. Dairy, cereals, edible oils, spices and some other sensitive items are excluded.
- Trade size
- Bilateral trade was USD 11.18 billion in FY 2025-26, up from USD 10.61 billion. Oman is India's second-largest trading partner in the Gulf.
- Regulatory recognition
- Oman will accept Export Inspection Council certificates. India's NPOP organic and halal certification are recognised.
- Oman's tariff offer to India
- Oman gives 100% duty-free access across 98.08% of its tariff lines, covering 99.38% of India's export value, from Day One.
- India's offer to Oman
- India offers liberalisation on 77.79% of its 12,556 tariff lines, covering 94.81% of imports from Oman by value. Sensitive items are in the exclusion list.
- Bilateral trade
- Trade was USD 10.61 billion in FY 2024–25, up from USD 8.94 billion in FY 2023–24.
- Regulatory cooperation
- The CEPA has TBT and SPS chapters. It requires acceptance of Export Inspection Council (EIC) certificates and recognises NPOP organic certification and halal certification systems.
Don’t confuse with CEPA vs FTA: An FTA mainly cuts tariffs on goods. A CEPA also covers services, investment and regulatory cooperation.
Don’t confuse with MFN vs preferential tariff: MFN is the tariff applied to all WTO members. A preferential tariff under a trade pact is lower and only for partners.
Don’t confuse with TBT vs SPS: TBT covers technical regulations, standards and conformity assessment. SPS covers food safety and animal and plant health measures.
International bodies and relations: the largest group of news questions in Prelims (61 since 2013), often about background, members and location. In Mains, 27 news-triggered questions, mostly on India's interests.
Why it matters
- Gives Indian labour-intensive exports such as gems, textiles, marine products and engineering goods an edge in the Gulf.
- Oman's ports at Sohar, Duqm and Salalah give access to GCC and East African markets.
- Binding commitments on professionals and services improve mobility for Indian workers.
- Near-universal duty-free access helps labour-intensive and MSME-led exports such as textiles, marine products and gems and jewellery.
- Oman works as a gateway to GCC and East African markets, and a diversification route amid rising protectionism.
- Services and mobility gains, such as the higher ICT ceiling, help Indian professionals and firms.
Problems
- Indian exporters must meet rules of origin and regulatory standards to claim benefits.
- Opening to Oman imports must be balanced with protection of farmers and domestic industry.
- Gains depend on Oman's limited import market of about USD 28 billion.
- India's trade deficit with Oman is large: imports were USD 6.55 billion against exports of USD 4.06 billion in FY 2024–25.
- Omanisation policies can limit the employment of Indian workers despite mobility commitments.
- Exporters may struggle to use the benefits because of non-tariff barriers and compliance needs.
Way forward
- Conclude the Social Security Agreement and the India–GCC trade talks.
- Build awareness among MSMEs on claiming preferential tariffs and certification.
- Use Omani ports and logistics links to enter GCC and East African markets.
- Raise exporter awareness, especially among MSMEs, so they use the preferences.
- Conclude the Social Security Agreement and support mutual recognition of qualifications.
- Use Omani ports and logistics hubs to reach GCC and East African markets.
Put in your answer
Trade volume: Bilateral trade reached USD 11.18 billion in FY 2025-26.
Services commitments: Oman made commitments in 127 services sub-sectors, the most comprehensive services offer by a GCC country to India.
Bilateral trade: Trade rose to USD 10.61 billion in FY 2024–25 from USD 8.94 billion in FY 2023–24.
Safeguards: India placed dairy, oilseeds, edible oils, cereals and other sensitive goods in its exclusion list to protect farmers and domestic industry.
First under any FTA: Oman committed to a defined category of professionals for the first time under any FTA.
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UPSC’s own questions that come close to this issue, from our Prelims and Mains banks.
Prelims practice · Pairs
Ours, not from a UPSC paper
Consider the following pairs about the India–Oman Comprehensive Economic Partnership Agreement (CEPA):
- 1.Share of India's exports to Oman that entered duty-free under the MFN regime before the CEPA — Over half
- 2.Maximum stay allowed in Oman for Intra-Corporate Transferees under the CEPA — Up to 4 years
- 3.Rank of Oman among India's trading partners in the Gulf region — Second-largest
How many of the pairs given above are correctly matched?
True or false?
1 of 14
Statements the way Prelims prints them. Say first, then see the fact.
1.Under the CEPA, 99.38% of India's exports to Oman by value get duty-free access.
True. 99.38% of India's exports by value get zero duty.
2.Before the CEPA, more than half of India's exports entered Oman duty-free under the MFN regime.
False. Only 15.33% of India's exports entered duty-free under MFN.
3.Dairy products, cereals and edible oils are among the products India has placed on its exclusion list.
True. India excluded sensitive items such as dairy, cereals, edible oils, spices and rubber.
4.Intra-Corporate Transferees may stay in Oman for up to 180 days under the CEPA.
False. ICTs may stay up to 4 years; independent professionals up to 180 days.
5.The agreement provides for future negotiations on a Social Security Agreement to avoid dual contributions for Indian workers in Oman.
True. A Social Security Agreement is to be negotiated later.
6.Oman is a member of the Gulf Cooperation Council (GCC).
True. Oman is one of the six GCC members.
7.Oman is India's largest trading partner in the Gulf region.
False. Oman is India's second-largest trading partner in the Gulf region.
8.Under the India–Oman CEPA, Oman gives duty-free access on 98.08% of its tariff lines for Indian exports.
True. Oman's offer covers 98.08% of tariff lines and 99.38% of India's export value.
9.The zero-duty concessions given by Oman are phased in over five to ten years.
False. Oman's zero-duty concessions apply from Day One. Phasing over five to ten years applies only to selected Indian processed products.
10.India has offered tariff liberalisation on all its tariff lines under the CEPA.
False. India offered 77.79% of its 12,556 tariff lines and kept an exclusion list.
11.The CEPA raises the Intra-Corporate Transferee ceiling from 20% to 50%.
True. The ICT ceiling rose from 20% to 50%.
12.Oman has made services commitments in 127 sub-sectors under the CEPA.
True. Oman undertook commitments across 127 services sub-sectors.
13.The CEPA includes mandatory acceptance of certificates issued by the Export Inspection Council.
True. Acceptance of EIC certificates is mandatory, which avoids repeat testing at Omani ports.
14.The Sanitary and Phytosanitary (SPS) Agreement deals with technical regulations and standards that should not create unnecessary obstacles to trade.
False. That describes the TBT Agreement. SPS deals with food safety and animal and plant health rules.
Written by us from the release, not by UPSC; checked by a second model.
Mains practice
15 marks · 250 words
The India–Oman Comprehensive Economic Partnership Agreement came into force on 1 June 2026, giving duty-free access to 99.38% of India's exports while India liberalises 77.79% of its tariff lines. Examine the key provisions of the agreement and discuss its significance and challenges for India's trade and strategic interests in the Gulf region.
Worth revising until Prelims 2028: most news questions come within two years of the event.