Oman, India sign tax protocol to boost economic relations

The Sultanate of Oman and the Republic of India recently signed an updated agreement in Muscat aimed at avoiding double taxation and preventing financial evasion. According to the Oman News Agency (ONA), the agreement was signed by Nasser Khamis Al Jashmi, Chairman of the Tax Authority, and Amit Narang, the Indian Ambassador to Oman. Al Jashmi emphasized that this agreement is of great significance for strengthening economic relations between Oman and India, and noted that the signing of the agreement is the result of ongoing efforts by both sides to strengthen bilateral cooperation in the field of taxation.

Oman is a strategic partner of India and an important interlocutor within the Gulf Cooperation Council (GCC), the Arab League, and the Indian Ocean Rim Association (IORA). The two countries share deep geographical, historical, and cultural ties, maintaining friendly and cordial relations. While interactions between the people of the two nations date back 5,000 years, formal diplomatic relations were established in 1955 and elevated to a strategic partnership in 2008.

To reflect this special friendship, India has invited the Sultanate of Oman as a guest country to participate in the G20 summit and related meetings during India's presidency in 2023. The two sides are also actively discussing advancing cooperation in strategic areas such as space, rare earth minerals, and cybersecurity. Furthermore, economic and commercial relations between India and Oman are flourishing, with bilateral trade reaching $9.988 billion in the fiscal year 2021-2022, and increasing to $12.388 billion in the fiscal year 2022-2023.

Investment flows between the two countries are robust, with numerous joint ventures established in both India and Oman. Currently, there are over 6,000 Indian-Omani joint ventures in Oman, with an estimated investment of over $7.5 billion. The Oman-India Joint Investment Fund (OIJIF) is a 50-50 joint venture between the State Bank of India and the former State General Reserve Fund (SGRF) of Oman. Launched in July 2010 as a special purpose vehicle (SPV) for investments in India, the fund began operations in 2011 with an initial capital of $100 million, which has been fully invested in seven Indian companies across various sectors. Following the successful deployment of the first and second tranches of funds, the Oman Investment Authority (OIA) and the State Bank of India (SBI) are currently in negotiations for the third tranche of funding for OIJIF, with investments expected to commence in 2023 and an estimated capital of $300 million.

India is one of Oman's major trading partners. In 2022, India was the second-largest market for Omani crude oil exports, after China. Additionally, India is the second-largest market for Omani non-oil exports, after Saudi Arabia, and the third-largest source of imports, after the UAE and Saudi Arabia. In the fiscal year 2022-2023, India's total exports to Oman amounted to $4.477 billion, making Oman the 31st largest export market for India during that period. Conversely, India's imports from Oman in the same fiscal year totaled $7.911 billion, making Oman the 24th largest source of imports for India in 2022-2023.