India-Oman trade CEPA opens doors to a $12.5 billion services opportunity in the Gulf: Services Export Promotion Council
India-Oman trade CEPA opens doors to a $12.5 billion services opportunity in the Gulf: Services Export Promotion Council
The India-Oman Comprehensive Economic Partnership Agreement (CEPA) unlocks a $12.5 billion services opportunity in the Gulf, enhancing market access for Indian service providers. With relaxed criteria for Intra-Corporate Transferees and a focus on sectors like healthcare and IT, the agreement promises significant commercial benefits and professional mobility for Indian businesses.
The agreement facilitates greater personnel mobility and introduces a Health-related Services Annex, promoting traditional medicine. It also includes provisions for a bilateral Social Security Agreement, benefiting Indian workers and joint ventures in Oman.
The recent India-Oman Comprehensive Economic Partnership Agreement (CEPA) throws open the door to a $12.5 billion India Services opportunity in the Gulf, estimates the Services Export Promotion Council (SEPC), set up under the Ministry of Commerce and Industry.
In 2024, India’s services exports to Oman were worth USD 665 million, while imports were USD 198 million. Oman’s global services imports are in excess of USD 12.52 billion, offering a large untapped potential for Indian service providers. “With deeper sectoral commitments and improved predictability in market access and professional mobility, Indian service providers can build long-term presence and scale service delivery with confidence,” says Abhay Sinha, Director General, SEPC.
The agreement offers broader and deeper market access commitments from Oman across all key sectors and modes of supply. Sectors of interest to India, such as computer-related services, business services, professional services, education, healthcare, R&D, and audio-visual services, have received the best treatment, ensuring enhanced commercial opportunities for Indian service providers.
Oman has, for the first time in any FTA, agreed to relax the limitation criteria for Intra-Corporate Transferees (ICTs) from 20% to 50%. This means Indian companies can now transfer a larger share of managerial and specialist personnel to their operations in Oman. Further, Oman has committed to the category of professionals, covering 15 sub-sectors including accounting, engineering, medical and dental, IT, construction, and education services. These mobility gains are crucial for the approximately 6000 India-Oman joint ventures already present in Oman, particularly those in the services sector, says SEPC.
The CEPA also introduces a dedicated Annex on Health-related Services and Traditional Medicine, aimed at promoting Indian systems of medicine such as AYUSH, fostering medical value travel, and encouraging institutional cooperation in the field of traditional medicine. This Annex is a first-of-its-kind initiative for India in any CEPA/FTA, noted the SEPC official.
Currently, Indian workers in Oman do not face dual social security contributions. However, to address any future challenges, the CEPA includes a specific commitment to negotiate an India-Oman CEPA bilateral Social Security Agreement. Once concluded, this will ensure continuity of social security benefits on a reciprocal basis and prevent dual contributions. This provision will benefit approximately 5.2 Lakh Indian workers and more than 6000 India-Oman joint ventures operating in Oman, he said.