Biz Updates: India-Oman trade ministers discuss FTA, RBI makes big announcement on banking system
New Delhi| The trade ministers of India and Oman reviewed the progress of the proposed Free Trade Agreement (FTA) between the two countries and stressed on taking forward the negotiations for the agreement. The agreement was discussed in Muscat between Commerce and Industry Minister Piyush Goyal and Oman’s Commerce, Industry and Investment Promotion Minister Kais bin Mohammed Al Yusuf.
“Our talks focused on pursuing negotiations on the Comprehensive Economic Partnership Agreement (CEPA), strengthening trade and investment ties and exploring opportunities to further deepen our bilateral partnership”, Goyal said.
Goyal is in Muscat for the Joint Commission meeting, which will be held on January 28. On 14 January, India and Oman held the fifth round of negotiations for the agreement, which was aimed at promoting bilateral economic relations. Negotiations for the agreement, officially called CEPA, will formally begin in November 2023. In such agreements, two trading partners either reduce or eliminate considerably customs duties on the maximum items traded between them. They also ease the criteria for promoting trade in services and attracting investment.
Oman is the third largest export destination for India among the Gulf Cooperation Council (GCC) countries. India already has a similar agreement with UAE, another member of the GCC which came into effect in May 2022. Bilateral trade has declined from USD 12.39 billion (exports USD 4.47 billion and imports USD 7.91 billion) in 2022-23 to USD 8.94 billion (exports USD 4.42 billion and imports USD 4.5 billion) in 2023-24. India’s main imports are petroleum products and urea. They account for more than 70 per cent of imports. Other major products are propylene and ethylene polymers, pet coke, gypsum, chemicals and iron and steel.
The number of credit cards doubled in five years to close to 11 crore
Credit cards are being issued extensively in the country. The number of credit cards has more than doubled to around 10.80 crore in the five years to December 2024, RBI reported. However, the number of debit cards remains stable.
According to the report, there were 10.80 crore credit cards at the end of December 2024. December 2019 was only 5.53 crore cards. In contrast, the number of debit cards stood at 99.09 crore in December 2024, with a slight increase from 80.53 crore in December 2019. Digital payments in the country have increased rapidly in the last decade. In 2013, there were 222 crore digital transactions worth Rs 772 lakh crore. By 2024, its volume increased 94 times to 20,787 crore and its value increased more than 3.5 times to Rs 2,758 lakh crore.
Digital payment volume in India has increased 6.7 times and value 1.6 times in the last five years. Retail digital payments in India increased from 162 crore transactions in FY 2012-13 to over 16,416 crore in 2023-24. That is, there has been an increase of almost 100 times in 12 years. The Reserve Bank of India is working towards increasing cross-border payments by linking UPI with faster payment systems in other countries.
RBI made a big announcement to increase liquidity in the banking system
The Reserve Bank of India said it will buy government securities worth Rs 60,000 crore in three tranches and take several other steps to increase cash in the banking system. As part of the banks’ liquidity recovery measures, the central bank also announced a USD/INR buy/sell swap auction worth USD 5 billion for a six-month period on January 31, 2025.
RBI said it will conduct open market operations (OMO) purchase auctions of Government of India securities for a total amount of Rs 60,000 crore. The purchase will take place on January 30, February 13 and February 20 in three phases in an installment of Rs 20,000 crore. In addition, a 56-day variable rate repo (VRR) auction for a notified amount of Rs 50,000 crore will be held on February 7.
