Oman has unveiled a sustainable finance framework to help reduce its reliance on fossil fuels and attract environmental, social and governance (ESG) investors.

Under the initiative, the Sultanate plans to issue financial instruments like green, social and sustainability bonds as well as loans and sukuk - bonds that comply with Islamic law - whose proceeds will be used to fund and re-finance renewable energy projects.

As power supply and fossil-fuel reserves come under pressure form population growth and rapid industrial development, "Oman appreciates the potential of renewable energy technologies," the country's finance ministry said in the report detailing out the framework.

Oman's Vision 2040, an economic development plan launched in 2021, envisions the country cutting oil's share of gross domestic product (GDP) to 16 per cent in 2030 and 8.4 per cent in 2040, down from 39 per cent in 2017.