India is poised to strengthen its Middle East connections with a new trade pact with Oman after the Lok Sabha Elections 2024. Despite the modest annual trade volume of under $13 billion, the tie-up is vital as Oman serves as a significant gateway to the Strait of Hormuz, a key passage for global oil shipments situated between Oman and Iran.
Despite the rising Red Sea tensions that are threatening important maritime lanes, India hopes to strengthen its ties with the Middle East by concluding a trade agreement with Oman in the next two months.
The upcoming Lok Sabha Elections in India, with results expected on June 4, will either approve or reject the planned trade agreement. India is currently focusing on bilateral deals with GCC members like Oman and the UAE, having made little headway on agreements with the GCC.
Additionally, the prospective deal with Oman also holds strategic significance amidst the GCC’s negotiations with Pakistan and China. Oman has agreed to waive taxes on $3 billion worth of annual Indian exports, which include goods from the automobile, medical device, engineering, textile, gem, and agricultural industries. In exchange, India has consented to impose import limits on certain items and to lower tariffs on a limited range of petrochemicals, aluminium, and copper that come from Oman.
