Muscat – The negotiations between India and Oman for a free trade agreement have made substantial progress in the last few rounds of discussions, according to India’s Foreign Secretary Vinay Kwatra.
Kwatra informed that Indian Prime Minister Narendra Modi and His Majesty Sultan Haitham bin Tarik gave a strong push to conclude the India-Oman Comprehensive Economic Partnership Agreement (CEPA) as early as possible.
“Although the negotiations on CEPA have started only recently, they have made substantial progress in the last few rounds of discussion and both leaders gave strong impetus and push to conclude the CEPA agreement as early as possible,” Kwatra said in a special press briefing in New Delhi on Saturday, as reported by ANI.
The formal commencement meeting for India-Oman CEPA took place on November 20, 2023, followed by the first round of negotiations in New Delhi from November 27 to November 29. The negotiations continued with the second round in Muscat from December 9 to December 11.
Oman is India’s third largest export destination within the GCC region. Bilateral trade between two countries surged from $5.01bn in Indian financial year 2018-19 to $12.39bn in Indian financial year 2022-23, according to an ANI report.
In another significant development in the India-Oman economic partnership, the third tranche of the Oman-India Joint Investment Fund has been announced, marking a major milestone in trade and capital cooperation between the two nations.
Kwatra highlighted the importance of this achievement during the state visit of His Majesty Sultan Haitham bin Tarik to India. “An important achievement in terms of India-Oman trade and capital cooperation was the announcement of the third tranche of the Oman-India Joint Investment Fund,” he said.
India’s Foreign Secretary also said that the Oman-India Joint Investment Fund, a 50-50 joint venture between the State Bank of India (SBI) and the Oman Investment Authority (OIA), aims to bolster economic ties by directing investments into the fastest-growing sectors of the Indian economy.
The third tranche of this fund would be worth $300mn. The fund’s earlier two tranches, valued at $100mn and $200mn, respectively, laid the groundwork for a strong economic alliance. The announcement of the third tranche of the fund not only signifies a substantial financial commitment but also cements the long-term vision of both nations to deepen economic and cultural ties.
Kwatra also informed that the discussions are underway between India and Oman about utilising the UPI stack, adding that talks on the possibility of rupee trade with Oman is still at the ‘exploratory stage’.
“Another element of discussion where we would try to move forward is the possibility of rupee trade which can work between the two countries. This is still at an exploratory stage but can be an important element of cooperation going forward,” Kwatra added.
On talks of digital payment cooperation between Oman and India, Kwatra said both sides discussed utilising the UPI stack with the potential corresponding digital stack in the Omanis ecosystem.
“There are also other elements of the Indian stack in terms of the digital infrastructure that can be suitable to Omanis priorities with regard to using now financial inclusion and financial technology payment systems; those are only one element of it but the interface of the UPI with a corresponding Oman platform is something we can talk about,” he added.