India signed a key pact with Oman on Monday that allows her military vessels to use the strategically located Duqm port and dry dock.

The Duqm port on the southeastern coast of Oman, opening into the Arabian Sea and the Indian Ocean, is strategic to India because to its north is the Chabahar port in Iran. India is helping develop Chabahar to open a trade route to Afghanistan and Central Asia, bypassing Pakistan.

The Chabahar port is crucial not only because Pakistan does not allow India to send goods to Iran and Afghanistan, but also because it will act as a counter to the nearby Gwadar port in Pakistan, which China is developing.

During his visit to Oman over the past two days, Prime Minister Narendra Modi and Sultan of Oman Qaboos bin Said signed an annexure to the Memorandum of Understanding on Military Cooperation, which makes the services of the Duqm port and dry dock available to Indian military vessels. The agreement will help India counter China in the Indian Ocean region, The Indian Express reported.

India and Oman also spoke about counter-terrorism and bilateral defence ties. In a joint statement, the countries said the Memorandum of Understanding on Military Cooperation, signed in 2005 and renewed in 2016, gave them the general framework to strengthen bilateral defence ties.

“Both sides expressed satisfaction at the signing of an annexure to the existing MoU on Military Cooperation between the defence ministries,” the statement said.

Modi said he “admired” Oman’s efforts to diversify its economy and welcomed the invitation to Indian companies to invest in various sectors of Oman’s Special Economic Zones, including one at Duqm.

Apart from defence and security, the two countries also discussed energy-related subjects, food security and education.