India, Oman sign protocol to amend double taxation, accelerate talks on free trade deal

Oman and India have signed a new agreement to update protocols to prevent double taxation and tackle financial evasion related to income taxes to boost economic ties between the two countries.

The agreement, aimed to amend their existing Double Taxation Avoidance Agreement (DTAA), was signed on January 27 by Nasser bin Khamis Al-Jashmi, Chairman of Oman’s Tax Authority, and Indian Ambassador to Oman Amit Narang, in Muscat, as per reports.

The new protocol will help in bolstering the economic relations between the two countries and enhance bilateral cooperation in the tax sector. The two countries also agreed to expedite discussions for a Comprehensive Economic Partnership Agreement (CEPA).

In December, Oman signed a similar agreement with Tanzania to strengthen their strategic partnership.

As of October 2024, India exported $410 million worth of goods to Oman, while imports worth $743 million were recorded, resulting in a trade deficit of $334 million, according to the Observatory of Economic Complexity.

Some of the top exports to Oman by India included petroleum products valued at $146 million, processed minerals at $24.4 million, and basmati rice at $15 million. On the other hand, India purchased fertilizers, totaling $118 million from Oman. Furthermore, petroleum products reached $92.5 million, and ships, boats, and floating structures were recorded at $77.5 million. 

The proposed CEPA is aimed at boosting trade and investment flows between India and Oman. By reducing or removing tariffs on a large number of goods and services, the agreement will create a more favourable environment for businesses in both countries.