Oman’s Sohar port comes looking for investments from India

Oman, September 10: As the Sultanate of Oman continues to focus on economic diversification beyond its traditional petrochemical base and strives to transform itself into a major industrial and logistics centre for the region in the coming years, theSohar port and Freezone comes looking for investmentsinto its 6,500 hectare (Ha) port and freezone to India. Moreover, with India jointly developing the Chabahar portin Iran in the vicinity, Oman is looking at developing a logistics hub connecting India-Iran-Oman as a key gateway to the Gulf and Central Asia.

Visiting Gujarat’s commercial capital Ahmedabad on a roadshow, representatives of Sohar Port and Freezone which is managed as a 50:50 joint venture between the Port of Rotterdam and the Sultanate of Oman said that the intention behind developing a freezone is to create jobs for young population of Oman more than just trying to boost the economy.

“Around 25% of the population of Oman is below 20 years, and we are aiming to create jobs for this young manpower. As an oil and gas reliant economy, we are not really looking for a financial boost to the economy by attracting companies there, but we are more keen on job creation,” said Neelima Vyas, director, international,Sohar Port and Freezone. She added that currently around 10,500 people are directly employed at the port and freezone, and if investments continue to flow in as expected, this number should treble in the coming few years.

Sohar Port and Freezone is a deep-sea port and free zone situated in the Sultanate of Oman, midway between Dubai and Muscat. With current investments of $25 billion, it is one of the world’s fastest growing port and free zone developments, the company claimed. It lies at the centre of global trade routes between Europe and Asia.

Already Indian majors like Jindal Group and L&T have presence in the Sohar Port and Freezone apart from smaller Indian companies like the Cabrol Group, who have set up a steel fabrication unit there. Vyas informed that in Gujarat they have held one-to-one talks with companies in sectors like polymer, pharmaceutical, food processing (as Oman is a net food importer) and steel among others.

The advantages of the Sohar Freezone includes 100% foreign ownership, free repatriation of capital and profits, corporate tax holidays of up to 25 years, no personal income tax, no duty on imports and exports, no minimum capital investment, Free Trade Agreement (FTA) with US apart from cheaper utilities, Vyas claimed.

Interestingly, India is jointly developing the Chabahar port in Iran that lies in the Gulf of Oman region and is part of India’s efforts to increase connectivity with Afghanistan and Central Asia. Indiasigned a tripartite agreement this year with Iran and Afghanistan to develop the Chabahar port and has committed around $500 million for the project.

As per reports, India is now also eyeing a role at Oman’s strategically located Duqm port, which is currently being developed by the Sultanate of Oman along with a special economic zone as a regional economic hub. Given the good political relations between Iran and Oman, India is eyeing to establish a link between Duqm and Chabahar ports in the future that would boost connectivity.

Duqm port is situated on the Southeastern side of Oman and can be accessed from the Indian Ocean. Vyas said that with India taking interest in port development in the region, the idea is to develop a link between Iran-India-Oman for sea trade purposes.

As a step in this direction, in February this year Oman and Iran officially launched a separate shipping route between Shahid Rajaee port and Sohar port to promote trade.

Meanwhile, Oman’s Sohar port has achieved an 18.6% growth in container volume in the first half of 2016, over the same period of last year.The port has handled more than 313,000 twenty foot equivalent units (TEUs) in the first half of 2016, against 264,000 TEUs in the same period of last year.