India and Oman signed a Comprehensive Economic Partnership Agreement (CEPA) on December 18th, 2025, aimed at boosting bilateral trade and investment while deepening economic ties. Under the pact, Oman will grant zero-duty access on over 98% of its tariff lines to Indian exports including gems and jewelry, textiles, pharmaceuticals, and autos. India will cut tariffs on about 78% of its tariff lines, covering roughly 95% of imports from Oman by value. Annual trade between the two countries exceeds $10 billion, and the deal is seen as part of India’s strategy to diversify trade amid steep U.S. tariffs. The agreement is Oman’s first bilateral trade pact since 2006. The trade deal reflects the strategic importance of Oman as a gateway near the Strait of Hormuz and is expected to unlock opportunities across various sectors and strengthen long term economic cooperation.
This article is important because it highlights the Indian strategy of the “Necklace of Diamonds” where they try and surround China. With a trade agreement established with Oman its strengthens their circle around China and gives them a strategic spot in the Strait of Hormuz. I don’t see this having a crazy lasting impact on the region but it is very important in India’s plan. For Oman this is a good trade agreement because it lowers Indian tariffs on most goods and it helps build a good relationship with a power player in the region. I think that this deal is very good from an American standpoint because its nice to see a rival state(China) being checked by a regional power(India).
I believe that all stakeholders involved in this deal have already responded. Potentially both countries could either pull out of the deal or stay in the deal.
This event connects directly to what’s been said in class because of India building their relationship with Oman which is in the “Necklace of Diamonds”. Also the Necklace of Diamonds could be seen as an Indian Geostrategy because they are using strategic geographic areas to surround China.