India-Oman Trade Deal Opens New Energy Route Amid Hormuz Uncertainty

India and Oman have operationalized a landmark Free Trade Agreement (FTA), strengthening economic ties and creating new opportunities for trade and energy cooperation. The agreement, which came into effect on June 1, aims to enhance bilateral commerce by eliminating tariffs on a wide range of products. Under the deal, 99.38 percent of Indian exports to Oman—including textiles, pharmaceuticals, engineering goods, automobiles, gems and jewellery, agricultural products, and medical equipment—will enjoy duty-free access to the Omani market. India has also extended tariff concessions to nearly 78 percent of products imported from Oman.

The agreement has gained strategic significance amid disruptions in the Strait of Hormuz, a critical global energy corridor through which nearly one-fifth of the world's oil supplies pass. With Oman’s major ports such as Salalah and Duqm located outside the Strait of Hormuz, India now has greater flexibility to secure oil and LNG imports even during regional tensions. Trade data indicates that imports from Oman have risen sharply, driven primarily by crude oil and fertilizer shipments, highlighting the growing importance of Oman as a key energy and trade partner.