India set to sign Free Trade Agreement with Oman amid ongoing FTA talks with Britain, EU

World Tuesday 18/June/2024 09:24 AM
By: Agencies
India set to sign Free Trade Agreement with Oman amid ongoing FTA talks with Britain, EU

New Delhi: Ahead of the eighth round of Free Trade Agreement (FTA) talks between India and the European Union (EU), the Indian government is all set to sign an FTA with Oman in the first 100 days of the third term of Prime Minister Narendra Modi.

Last week, Modi said that strategic ties between India and Oman are destined to scale new heights and the matter figured in Union Commerce Minister Piyush Goyal’s review meeting.

“Thank His Majesty Sultan Haitham bin Tarik of the Sultanate of Oman for his call and deeply appreciate his warm felicitations and words of friendship. The centuries-old India-Oman strategic ties are destined to scale new heights,” Modi wrote in a post on X (formerly Twitter) on June 12.

Hindustan Times reported, citing officials aware of the matter, that negotiations between India and the Sultanate of Oman were almost over during Narendra Modi’s previous term, though the FTA deal could not be signed with the enforcement of the model code of conduct (MCC) on March 16 following the announcement of schedule for the 2024 national elections in India.

The officials said that the FTA between India and Oman is almost finalised, and it is likely to be concluded soon.

India, which has signed 13 free trade agreements in the last five years with its trading partners, has been holding FTA talks and negotiations with several partners – both bilateral and regional – in a bid to boost export-oriented domestic manufacturing.

Earlier on March 10, days before the general elections, India signed an FTA with a group of four European countries—Iceland, Liechtenstein, Norway, and Switzerland, where these four countries committed to invest $100 billion in India to create one million direct jobs over 15 years, as per reports.

Meanwhile, ahead of the eighth round of FTA negotiations scheduled from June 24 to 28 in Brussels, India and the European Union (EU) discussed New Delhi’s concerns regarding the carbon border adjustment mechanism (CBAM), which intends to tax carbon-intensive products coming into the EU from 2026.

The CBAM, using which the EU wants to encourage cleaner industrial production in non-EU countries, is divided into two phases, with the first phase (transitional phase) kicking in from October 1, 2023.

Business Standard reported, quoting department of commerce additional secretary L Satya Srinivas, that the outstanding issues with regard to the proposed FTA between India and the United Kingdom will be taken up after the general elections in Britain, which is scheduled to be held on July 4.

So far, a total of 13 rounds of negotiations for the long-awaited FTA between India and the UK have been held, and the 14th round began on January 10, 2024, as per reports.

According to official statistics, the trade negotiations between both nations, which aim to secure an "ambitious" outcome for bilateral trade - currently worth around GBP 38.1 billion a year, opened in January 2022.

Meanwhile, days before the national polls, India signed a Trade and Economic Partnership Agreement (TEPA) with a four-nation non-EU European Bloc of Iceland, Norway, Liechtenstein and Switzerland on March 10.

These four countries reportedly committed to invest $100 billion in India to create one million direct jobs over the next 15 years.

According to a report by The Hindu, negotiations for the TEPA began in 2008, and it was completed after 21 rounds of talks.

Negotiations for the modern and ambitious trade agreement had been suspended for 10 years between 2013 and 2023, as per reports.

Besides the United Kingdom and European Union, India is currently in negotiations with various countries, including Israel, Peru, New Zealand, and unions, including Bay of Bengal Initiative for Multi-Sectoral Technical and Economic Cooperation (BIMSTEC), Eurasian Economic Union, Gulf Cooperation Council and IBSA, for free trade agreements, reports said.

According to reports, when signed, the FTA between India and Oman will be the first important international bilateral trade deal of the Narendra Modi's NDA government's third term and the fourth since 2022.

As per government data, India signed an FTA with the United Arab Emirates (UAE) on February 18, 2022, followed by another deal with Australia (Australia-India Economic Cooperation and Trade Agreement or, ECTA) on April 2 of that year.