ABOUT OMAN

 Amongst all the countries in the Arabian Peninsula, Oman, officially the Sultanate of Oman, occupies a strategic position on the southeastern coast, bordering the Arabian Sea and the Gulf of Oman. Historically a powerful maritime trading nation, Oman is known for its rich cultural heritage, diverse landscapes, and stable political environment. The country is actively pursuing economic diversification under “Oman Vision 2040,” aiming to reduce its reliance on oil and develop non-oil sectors. Muscat is the capital and largest city, serving as the nation’s political, economic, and cultural heart. According to the World Bank, Oman is classified as a High-Income Economy.

The currency of Oman is the Omani Rial (OMR), which is one of the world’s strongest currencies. As of today’s exchange rates (June 2025), 1 Omani Rial is approximately 221.73 Indian Rupees. The population of Oman is estimated at approximately 5.3 million in 2024, including a significant expatriate community that contributes to its diverse workforce. Oman shares land borders with Saudi Arabia and the United Arab Emirates to the west, and Yemen to the southwest. It has maritime borders with Iran and Pakistan across the Strait of Hormuz, Gulf of Oman, and the Arabian Sea. The official language is Arabic. English is widely spoken and understood, particularly in business, tourism, and among the expatriate population. Islam is the dominant religion, with the majority belonging to the Ibadi school, alongside Sunni and Shia communities, and various other faiths practiced by expatriates. Major international airports include Muscat International Airport (MCT) and Salalah International Airport (SLL). Oman boasts world-class commercial seaports such as Sohar Port and Freezone, Duqm Port (a strategically important new port), and Salalah Port, all vital for regional and international trade.

The standard corporate income tax rate in Oman is generally 15% on taxable income for most businesses, including foreign entities. Oman actively promotes foreign direct investment (FDI) as a cornerstone of its economic diversification strategy (Oman Vision 2040). The Ministry of Commerce, Industry and Investment Promotion (MOCIIP) and the Oman Investment Authority (OIA) are key government bodies facilitating investment. Incentives are offered across various sectors and special economic zones:

• Tax Exemptions: Companies operating in Special Economic Zones (SEZs) like Duqm, free zones (Sohar, Salalah), and industrial estates often benefit from long-term tax holidays (e.g., up to 30 years in Duqm SEZ) and exemptions from customs duties on imported raw materials and equipment.
• 100% Foreign Ownership: The Foreign Capital Investment Law (FCIL) generally permits 100% foreign ownership in most sectors, removing the previous requirement for local partners, provided certain minimum capital requirements are met.
• Free Repatriation of Capital and Profits: No restrictions on the transfer of funds.
• Subsidized Utilities & Land: Competitive rates for energy and industrial land in designated areas.
• Strategic Location: Access to key markets in the Middle East, Africa, and Asia, bypassing the Strait of Hormuz from Duqm and Salalah. Opesh Group of companies will be helping you in completing the Due Diligence process which includes financial planning, registration process, business options, and if required, even helping you find a Rental property for your office.

Establishing a business in Oman has become more streamlined due to recent legislative reforms, including the new Foreign Capital Investment Law, aimed at creating a more investor-friendly environment. Foreign investors can typically establish a Limited Liability Company (LLC), a Branch Office, a Joint Stock Company, or operate within free zones. The government’s clear commitment to attracting FDI and diversifying the economy makes Oman an increasingly attractive destination for international businesses.

In case an investor is planning to establish an LLC or a corporate business setup in Oman, Opesh Group will be helping you in taking the right decision for setting up your business in Oman and we will also guide you about how to follow the procedure while formulating your company in Oman.

Types of Business which can be started in Oman (aligned with Oman Vision 2040):

• Manufacturing: Focus on downstream industries related to oil & gas (petrochemicals), aluminum, food processing, logistics-related manufacturing, and advanced materials.
• Logistics & Transportation: Leveraging its world-class ports (Sohar, Salalah, Duqm) and strategic location, opportunities in shipping, warehousing, supply chain management, and integrated logistics services.
• Tourism & Hospitality: Development of luxury resorts, cultural tourism (heritage sites, traditional Omani experiences), adventure tourism, and MICE (Meetings, Incentives, Conferences, and Exhibitions) facilities.
• Mining: Exploration, extraction, and processing of minerals such as copper, chromite, gold, limestone, gypsum, and silica, aiming for value addition.
• Fisheries & Aquaculture: Modernizing traditional fishing, developing aquaculture projects, and fish processing for export.
• Information & Communication Technology (ICT): Growth in data centers, cloud services, cybersecurity, digital transformation solutions, and smart city technologies.
• Renewable Energy: Significant potential in solar and wind power, with a long-term vision for green hydrogen production and export.

Advantages of Starting Business in Oman:

• Strategic Geographic Location: Control over the Strait of Hormuz and direct access to international shipping lanes via its Arabian Sea ports (Duqm, Salalah).
• Political Stability: A long history of stability and neutrality in the region.
• Investor-Friendly Environment: Recent reforms allowing 100% foreign ownership in many sectors, competitive tax rates, and free zones.
• Modern Infrastructure: State-of-the-art ports, airports, roads, and telecommunications networks.
• Growing Non-Oil Sectors: Strong government push for diversification under Oman Vision 2040.
• Access to Regional Markets: Membership in the GCC provides access to a large customs union.
• Quality of Life: Safe and welcoming environment for expatriates.

Imports & Exports: Oman’s trade balance is dominated by hydrocarbon exports, but non-oil exports are steadily growing as part of its diversification strategy.

Major items which are exported from Oman:

• Crude Petroleum & Natural Gas
• Refined Petroleum Products
• Polypropylene, Urea, and other Petrochemicals
• Aluminum
• Mineral Ores (e.g., copper, chrome)
• Fish and Fish Products

Major items which are imported in Oman:

• Machinery and Electrical Equipment
• Vehicles and Transport Equipment
• Manufactured Goods
• Foodstuffs
• Chemical Products
• Iron and Steel

Major items traded between Oman and India (as of June 2025): India is a key strategic and economic partner for Oman, with diversified bilateral trade.

• Exports from Oman to India: Primarily Crude Oil, Natural Gas (LNG), Chemicals (e.g., polypropylene, urea), Fertilizers, and some Mineral Ores.
• Imports in Oman from India: Include Petroleum Products (refined), Machinery and Engineering Goods, Electrical Equipment, Food Grains (especially Basmati rice), Meat & Fish, Chemicals, Pharmaceuticals, Textiles, and various Consumer Goods. Indian companies have a significant presence in Oman’s infrastructure and services sectors.

Manufacturing: Manufacturing is a crucial pillar of Oman’s economic diversification, with significant investments in downstream industries and value addition to its natural resources.

• Oil & Gas Downstream: Large-scale refineries producing a range of petroleum products, and petrochemical plants manufacturing polymers, fertilizers, and other chemicals.
• Aluminum: Production of primary aluminum (Sohar Aluminium) and related downstream industries (e.g., aluminum extrusion, cables).
• Food & Beverages: Growing sector focused on local production and processing of food items, aiming for food security.
• Basic Metals: Steel and other metal industries.
• Building Materials: Cement, glass, and other materials supporting the construction boom.
• Fiberglass products: Growing manufacturing of fiberglass products. The government is promoting advanced manufacturing and attracting investments in industries that leverage technology and innovation.

Mining: Oman possesses significant mineral wealth beyond its hydrocarbons, and the mining sector is a key focus for diversification under Vision 2040.

• Crude Oil & Natural Gas: Remains the dominant mining activity, the primary source of national revenue.

• Copper: Historically known for copper, with efforts to revive and expand copper mining and processing.

• Chromite: Significant reserves, with increasing focus on ferrochrome production.

• Gold: Smaller-scale gold mining and exploration activities.

• Industrial Minerals: Abundant deposits of limestone, gypsum, silica, and marble, used for construction materials and industrial applications. The government is encouraging foreign investment in mineral exploration and the development of value-added metallurgical industries.

• GDP = $116.8 billion (nominal, 2024 est. IMF)

• GDP Growth = 2.6% (2024 forecast, IMF); 2.4% (2025 forecast, IMF)

• Ease of doing business rank = The World Bank’s ‘Doing Business’ report has been discontinued. In its last edition (2020), Oman ranked 103rd globally out of 190 economies, showing continuous efforts to improve its business environment through legislative reforms, digitalization of services, and streamlining procedures, particularly notable in the recent investment law.

• GDP per Capita = $22,040 (nominal, 2024 est. IMF)

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