India-Oman agreement is more than a trade deal:How Muscat can help mitigate India’s oil, gas fertilizer crisis – key points

The Free Trade Agreement (FTA) between India and Oman came into force on Monday, 1 June, 2026. According to the global think tank, GTRI, founder, Ajay Srivastava, this was India’s fifth FTA implemented in last five years and 15th overall. India-Oman deal entitles India to secure energy supplies: Given the ongoing West Asia conflict and the resultant energy supply issues for India, the deal with Oman seeks to iron out such issues to some extent. Currently, the country is gripped with fears of shortage of petrol, cooking gas and fertilisers. Albeit, the government has never admitted a shortage of such essential items. But nevertheless, of all the goods that India imports from Oman, crude oil, LPG and fertilizers constitute the bulk of those shipments. Put together these command 38% share in imports from the Gulf country. The agreement deepens India’s energy security by ensuring access to Omani crude oil, LNG, fertilizers, methanol and ammonia, worth over $7.2 billion in imports in FY2026. -GTRI, founder, Ajay Srivastava What India imports from Oman? India and Oman have witnessed steady growth in bilateral trade over recent years. India imported $7.2 billion (₹68,400 crore) worth of goods from Oman in fiscal 2026, dominated by crude oil ($1.6 billion or ₹15,200 crore), liquefied natural gas ($1.2 billion or ₹11,400 crore), and fertilizers ($843 million or ₹8,008.5 crore). India-Oman trade size: Oman is India’s second-largest trading partner in the Gulf region. Bilateral trade between India and Oman reached $11.18 billion or ₹1.06 lakh crore in FY 2025-26, up from $10.61 billion (₹1 lakh crore) in FY 2024-25. Oman’s strategic advantage — A route beyond the Strait of Hormuz Earlier, the think tank had said that India’s imports from Oman had actually skyrocketed in the wake of the Iran war led supply disruptions. The shipments had more than tripled in volume at a time when shipments from other Gulf economies faced continuous disruptions. Oman had emerged as an alternative trade corridor for India as the Strait of Hormuz still remains close due to the US-Iran faceoff. The reason is that Oman sits in a unique geographic location outside the dangerous war zone, allowing ships to pass safely. Imports from Oman had risen from a modest $430 million (₹4,085 crore) in April 2025 to nearly $1.5 billion (₹14,250 crore) in April 2026. According to the global think tank, GTRI, India had quickly bought massive amounts of crude oil and urea from Oman to make up for losses elsewhere. GTRI had added that Oman’s secret is its geography. Unlike Iraq or Kuwait, which are trapped inside the Persian Gulf and must use the blockaded Strait of Hormuz, Oman has a long coastline facing the open Arabian Sea. Its major ports, like the Port of Salalah and the Port of Duqm, stayed completely safe and open. Trade deal unlocks huge benefits for exporters: Coming back to the trade deal, the India-Oman Comprehensive Economic Partnership Agreement (CEPA) will benefit domestic exporters in sectors such as textiles, leather, plastics, marine products, automobiles, sports goods, and agri-items, said Commerce and Industry Minister Piyush Goyal. The trade pact is expected to boost exports from India with improved market access. Oman has granted zero-duty access on 98% of tariff lines covering 99% of India’s exports, boosting prospects for products ranging from petroleum goods to machinery and steel. -GTRI, founder, Ajay Srivastava Under the agreement, several Indian products will enjoy immediate duty-free access to the Omani market. These include natural honey, cashew, boneless meat, bakery products, chocolate and sugar confectionery, mineral water, cheese, curd, milk, cream, frozen fish and butter. The CEPA is also expected to benefit India’s exports of animal and vegetable fats and oils, which currently attract import duties ranging between 5% and 100% in Oman. Lower regulatory restrictions for Indian professionals visiting Oman Beyond trade in goods, the agreement contains substantial commitments in services and mobility. It provides enhanced mobility provisions for Indian professionals. The pact also liberalises entry and stay norms for professionals in sectors such as accountancy, taxation, architecture and healthcare. Background: The free trade pact was signed on 18 December 2025 in Muscat. Upon completion of internal processes by both parties, the agreement entered into force on 1 June, 2026.