India issues rules of origin for Oman CEPA

MUSCAT, MAY 31

India has formally notified the rules that will govern the determination of origin of goods traded under the India-Oman Comprehensive Economic Partnership Agreement (CEPA), paving the way for the implementation of preferential tariff benefits from June 1, 2026.

The new framework, issued by India's Ministry of Finance through Notification No. 48/2026-Customs (N.T.), establishes the Customs Tariff (Determination of Origin of Goods under the Comprehensive Economic Partnership Agreement between India and Oman) Rules, 2026. The regulations are designed to ensure that only products genuinely originating in either country qualify for reduced customs duties under the landmark trade pact signed on December 18, 2025.

The rules represent a critical operational component of the CEPA, providing customs authorities, exporters, manufacturers and importers with detailed guidelines for determining whether goods meet origin requirements and are therefore eligible for preferential tariff treatment.

Under the framework, products will qualify for tariff concessions if they are either wholly obtained or produced within India or Oman, or if they have undergone sufficient manufacturing or processing in accordance with product-specific rules set out under the agreement.

A key feature of the regulations is the introduction of value-addition requirements. Manufacturers may calculate local value addition using either a "build-down" or "build-up" methodology. The build-down method measures the proportion of non-originating materials used in a product, while the build-up approach assesses the contribution of originating materials, labour and production overheads.

Trade experts view rules of origin as one of the most important elements of modern free trade agreements because they prevent goods from third countries being routed through a partner country solely to gain tariff advantages. The newly issued rules contain extensive verification and compliance mechanisms intended to safeguard the integrity of preferential trade between the two countries.

The regulations also establish a bilateral cumulation system, allowing originating materials from one partner country to be treated as originating materials in the other when used in further manufacturing. This provision is expected to encourage deeper industrial integration and cross-border supply chains between India and Oman.

Another significant provision relates to direct consignment requirements. Goods must either be transported directly between the two countries or remain under customs control while transiting through third countries. Importers may be required to provide documentary evidence, including bills of lading and customs certifications from transit countries, to demonstrate compliance.

To support implementation, exporters seeking preferential tariff treatment must obtain a Certificate of Origin issued by designated authorities. The certificate may be issued electronically or in physical form and will remain valid for 12 months from the date of issuance. The rules also envision the future adoption of fully digitised certificates and self-certification mechanisms.

The framework includes detailed procedures for record-keeping, verification, audits and compliance. Exporters, producers and issuing authorities will be required to maintain supporting documentation for at least five years. Customs authorities in both countries will have the power to verify claims, request additional information and conduct investigations where doubts arise regarding the origin status of products.

The rules further establish a Subcommittee on Rules of Origin, comprising representatives of customs administrations, competent authorities and issuing agencies from both countries. The body will oversee implementation, facilitate cooperation and review product-specific rules as trade patterns evolve.

For Oman, the agreement could create new opportunities for exporters in sectors such as fisheries, petrochemicals, minerals, chemicals, plastics and manufactured goods, many of which are covered by product-specific origin criteria. The regulations provide the certainty needed by businesses to structure production processes and supply chains in a manner that maximises access to preferential tariffs.

The notification marks another milestone in the operationalisation of the India-Oman CEPA, which is expected to strengthen bilateral trade, encourage investment flows and support the development of integrated value chains between the two economies. With the rules entering into force on June 1, exporters and importers on both sides are expected to begin aligning documentation and compliance procedures to take full advantage of the agreement's tariff concessions.