India and Oman will sign a trade agreement in the coming months, said two Indian government officials, as New Delhi looks to strengthen its relationships in the Middle East, where rising tensions are jeopardizing important maritime routes.
“It will help India with a strategic partner and access to key trade routes in a volatile region”, one official said.
India and Oman have a trade volume of less than $13 billion per year, but the connection is significant for New Delhi since the Gulf nation serves as a gateway to the narrow Strait of Hormuz between Oman and Iran, a vital transit route for oil shipments.
Israel’s battle against Hamas in Gaza has escalated into confrontations with Iran, and Yemen’s Iran-aligned Houthi insurgents have conducted numerous drone and missile strikes in the Red Sea region, claiming support with Palestinians in Gaza.
“The trade agreement must be approved by the government that wins India’s upcoming national elections, the results of which are set to be announced on June 4”, authorities added.
After making little headway on an agreement with the Gulf Cooperation Council (GCC), India has shifted its focus to bilateral accords with GCC member nations such as Oman and the UAE.
“The anticipated pact with Oman also gives a competitive edge as GCC is negotiating trade agreements with Pakistan and China”, the official remarked.
“Oman has agreed to reduce taxes on Indian exports worth $3 billion annually, including agricultural items, gems and jewellery, leather, autos, medical gadgets, technical products, and textiles”, the officials added.
The official went on to say, “India has agreed to reduce duties on some petrochemicals, aluminium, and copper from Oman while capping imports of such goods.”
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