Research

• Commentary
• publication date:2025/04/28

Geopolitical Implications of the Oman Duqm Port Development

MEIJ Commentary No.9

Kenta Aoki,

Former Executive Research Fellow, MEIJ

 

The development of the port of Duqm in eastern Oman is steadily progressing, taking advantage of its geopolitical advantages and attracting foreign investment. Ports have often been discussed in the context of competition between China and India in the Indian Ocean. In the process of promoting ‘Belt and Road Initiative (BRI)’, China is extending its tentacles with the intention of turning Duqm Port into a military port. India, in response, is checking this by arranging for warships to call at the port from Oman. This study examines whether this view aligns with the actual situation based on the author’s field research (February 2025) and considers the geopolitical implications of port development.

 

Port of Duqm, a port in Oman located at a geopolitical strategic point

Oman has four main ports: Muscat, Sohar, Duqm, and Salalah, of which Duqm Port has a newer history. Originally a small fishing village, Duqm has been in full operation since 2012, and infrastructure development, including ports, roads, airports, and railways, is currently underway at a rapid pace. Road development has already been completed, and it connects to other road networks in Oman. In addition, domestic flights are now operational at Duqm Airport, which can be visited in approximately an hour from the capital, Muscat, using LCC Salaam Airways. 

One of the main features of the port is that the Special Economic Zone (SEZ) is designated on a vast area of 2,000 square kilometers under the supervision of the Oman Special Economic Zones and Free Zones Authority (OPAZ). This area, known as the Special Economic Zone At Duqm (SEZAD), is the largest SEZ in the Sultanate of Oman and is a sign of the Omani Government's commitment to the area. Within the SEZAD, a number of projects have been set up, including a passenger bus assembly plant by the KARWA Motor Company with investment from Qatar, a green steel (low-carbon iron source) manufacturing plant by the Indian conglomerate Jindal, and a China-Oman Industrial Park. Progress has also been made in the construction of a residential area called the Renaissance Village and in efforts to develop tourist attractions and activities that take advantage of the geographical location, such as whale watching. International schools are also in operation with foreign investor families in mind.

 A petroleum refining facility is in operation at SEZAD, which is a center for refining oil imported from Kuwait and exporting it abroad. Importantly, the development of green hydrogen and ammonia is an urgent priority in Oman to meet the targets set in Vision 2040. Oman’s current oil and natural gas reserves are very small compared with those of other Gulf countries, and the country urgently needs to diversify its economy and decarbonize as soon as possible.

 Against this backdrop, Duqm has high potential for renewable energy sources such as wind and solar power, as the land is flat with no undulations, the wind is strong because of its coastal location, and the hours of sunshine are long. The Government of Oman is also actively attracting investment in green hydrogen- and ammonia-related projects, and the Japanese companies Mitsui & Co. and Kobe Steel Ltd. are jointly preparing to launch a full-scale project for green steel production.

 

Figure 1: Location map of Duqm port.

 

 

(Source: Google Map)

 

The deep-water port of Duqm, with a water depth of 18 meters, is equipped with gantry cranes and can be used for loading and unloading container vessels, as well as for roll-on/roll-off (RORO) vessels, which can unload trucks and other large cargoes directly from the port. Apart from the commercial port, the berth also has a military port that warships from various countries call. When the author visited, he saw the Japanese Maritime Self-Defense Force’s destroyer Murasame calling at the port from his boat. A dry dock is also operational for hull inspection and repairs.

 

Interest and involvement of other countries in the port of Duqm

How are China, India, and other countries involved in the port of Duqm? China has sought to take advantage of great power competition and strengthen its supply chain by developing the BRI, establishing a naval security base in Djibouti in the Indian Ocean (2017), and promoting the China-Pakistan Economic Corridor (CPEC), with Gwadar Port, Pakistan, as the gateway to the country. In the context of these developments, China has established a ‘China-Oman Industrial Park’ in Oman (Photo 1), reportedly in an effort to increase investment. Around 2018-2019, warnings about China’s expansion into Oman were discussed in Japan under headlines such as ‘Red economic zone “maritime powerhouse” spreads alarm’ (Nikkei) and ‘China’s influence on Oman expanding?’ (JETRO).

However, when the author visited the China-Oman Industrial Park, the author found that, contrary to the grandiose plans, development was not progressing as expected. Construction had yet to commence on most of the sites allocated to the industrial park, and the area appeared largely unoccupied. A gymnasium-like building that appeared to be a material market was observed; however, there was only one Chinese restaurant and a sparsely-operated commercial building.

 

Photo 1: Stone monument at the China-Oman Industrial Park.

 

(Source: author’s field documentation)

 

According to interviews with the Duqm Port Authority, the right to operate Duqm Port was granted by a joint venture between the Omani company ASYAD and the Belgian port of Antwerp (50%-50% stake). This is in contrast to the operating rights of the Iranian port of Chabahar, whose development is progressing with Indian investment granted to Indian Ports Global Limited (IPGL).

Documentation indicates that the United Kingdom government formalized a Memorandum of Understanding with Oman in 2017 to establish a logistics hub at Duqm Port, intended to function as a strategic position for Royal Navy deployments in the Indian Ocean region. Likewise, in May 2021 India renewed its 2018 defense pact with Oman, which gives the Indian military access to the port of Duqm. Duqm Port’s development continues to progress incrementally, attracting multinational interest while leveraging its strategic geographic positioning outside the critical maritime chokepoints of the Strait of Hormuz and the Bab al-Mandab Strait.

 

Oman’s balanced diplomacy and the development of Duqm port

Having considered the Duqm Port development from an external perspective, how does Oman, the country concerned, position the Duqm Port development in its own future plans? During the course of this research, the author observed that Oman has historically been located at a geopolitical strategic point that links East and West, and as such has nurtured a spirit of tolerance and acceptance of diversity, and in terms of diplomacy has a policy of balanced diplomacy. As a relatively small country with a population of approximately 5 million, Oman seems to have deliberately steered a fine balance among the US, China, India, Europe and East Asia, not getting too close to any of these countries, nor distancing itself.

In this context, Oman has focused on third-party mediation and has been quick to establish channels with both disputing parties in situations of conflict and political tension in neighboring countries, hosting reconciliation meetings and conducting shuttle diplomacy. For example, it was Oman that played the role of mediator when the Iran Nuclear Agreement (JCPOA) between Iran and the P5+1 was signed in July 2015. Oman also reportedly negotiated the release of the crew of the NYK-operated vessel Galaxy Leader, which was captured by the Houthis in Yemen, through its own network with the Houthis.

As its unique diplomatic stance suggests, Oman tends not to take a biased position towards either country, and this is also the case with regard to port development: although there was an Omani-Chinese approach when the port became operational in 2012 in anticipation of Chinese investment in the Duqm port development, the transition up to the present time has shown that Oman has chosen to strike a balance by bringing in Europe, rather than giving China the right to operate the port. The China-Oman industrial parks seen on the ground seemed to hint at Oman’s willingness not to be overly dependent on one country.

On the contrary, China is certainly an important trading partner for Oman, as it is Oman’s number one export partner and number three import partner. For Oman, China is largely its largest export partner in terms of crude oil. In light of this situation, China’s influence on the Omani economy as a whole is significant, and therefore needs to be evaluated in a corrective manner, together with the fact that its involvement in the Duqm port development is not progressing as planned.

Furthermore, in Oman, where historical human and material exchanges with the Indian subcontinent via the monsoon have been extensive, Indian influences have been felt in many sectors of society. A large number of Indian-origin people are active in Omani society, and indeed Indian companies have made great strides in the development of the port of Duqm. Simultaneously, however, Oman has not taken the position of being solely Indian. The same applies to the US, Europe and Japan, and overall, Oman seems to have adopted a sophisticated policy of getting along well with various countries while never giving up its own discretionary powers.

 

Summary

As seen throughout this paper, the development of Duqm Port is not progressing solely on the basis of Chinese investment, but rather Oman is diversifying its balance, by partnering with the UK, Belgium, India, Gulf States, Japan and others. Although the port is still under development, its geopolitical advantage of bypassing two chokepoints, the Strait of Hormuz and the Bab El Mandeb Strait, means that it is being progressively developed with investment from other countries. In the context of Oman’s economic diversification trend with a view to achieving Vision 2040, the port has the potential to play a leading role in the conversion to green hydrogen and ammonia, given its location and natural environment.

However, a major challenge is how Oman can increase the competitiveness of Duqm Port in the face of more attractive offers from its Gulf neighbors. In addition, the fact that the construction of a railway line is still in progress and that the airport does not yet have international flights taking off and landing makes the movement of goods and access for foreign investors difficult, which are also challenges that need to be overcome.

In this context, for Japan, which is surrounded by the sea on all sides, contributing to the development of the port of Duqm is an important issue that should be considered diplomatically. As Japan depends on the Middle East for approximately 95% of its crude oil imports, it is forced to constantly envisage next best measures to ensure freedom of navigation and to avoid risk in the event of an emergency at a choke point. In particular, the port of Duqm could play a role in energy security in the context of increasing uncertainty in the context of great power competition in what has been described as the ‘age of geopolitics.’

Japan can also deepen its traditional friendship with Oman one step further by developing high-quality infrastructure, hosting international maritime conferences and cooperating in the field of research and study, with a view to realizing the ‘Free and Open Indo-Pacific’ (FOIP) concept. Japan has room to expand multifaceted cooperation with Oman, a ‘maritime power’, including in the development of its ports. In addition, although attention has tended to focus on the eastern ocean region of the Indo-Pacific region in the past, it is of high importance for Japan, a trading nation, to ensure the safety of navigation in the western ocean region of the Indo-Pacific region, which includes Iran, Pakistan and the east coast of the African continent. In other words, the geopolitical importance of the Omani port of Duqm, located at the nexus of these countries and regions, can also be understood from a different angle if we are aware of the strengthening of connectivity in the said waters. It is precisely the continuous effort to make the sea a public good open to all that is important.

 

 

*MEIJ Commentary is a timely commentary on current affairs by MEIJ research fellows and external committee members. It focuses on the restructuring of the regional order in the Middle East and great power-led connectivity strategies.

*Views expressed in this article are the author’s own and do not represent the views or opinions of the author’s current and/or former employer(s).

 

Author’s Biography

Kenta Aoki is a Former Executive Research Fellow at MEIJ.

 

 

 

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