Business · Trade · 2 hrs ago
India’s trade agreements could add $140 billion to GDP by 2035
India is expanding its free trade agreements, which lower barriers to trade between partner countries.
A global economy model estimates that India’s concluded and proposed deals could add about $140 billion to its GDP by 2035, or 1.7% above the baseline.
The estimate also points to a possible 6.2% increase in exports.
Agreements with Australia and the United Arab Emirates took effect in 2022, while deals with the European Free Trade Association, the UK and Oman entered into force in 2025–26.
India has also signed an agreement with New Zealand and concluded negotiations with the European Union.
The expansion comes as higher US tariffs encourage countries to diversify trade and supply chains.
The gains could be larger if India improves manufacturing productivity and helps underemployed agricultural workers move into manufacturing and services.
India’s expanding free-trade agreements could add about $140 billion to its GDP by 2035, according to Bloomberg Economics.
The agreements could also increase India’s exports by 6.2% by 2035.
The estimate uses a large-scale model of the global economy developed by the World Trade Organization.
The deals could open markets, reduce import costs, attract foreign investment and raise productivity.
India has expanded trade ties as higher US tariffs reshape global trade and supply chains.
- Who
- India and its trade partners.
- What
- India’s expanding free-trade agreements could add about $140 billion to GDP by 2035 and increase exports by 6.2%.
- When
- By 2035.
- Where
- India and the international markets covered by its trade agreements.
- Why
- The agreements could improve market access, reduce import costs, attract foreign investment and raise productivity.
This story does not have two clearly opposing sides.
Trade agreements with Australia and the United Arab Emirates took effect.
Donald Trump and Narendra Modi announced plans for a bilateral trade agreement.
The Association of Southeast Asian Nations and China signed an upgraded free-trade agreement.
Agreements with the European Free Trade Association, the United Kingdom and Oman entered into force.
India signed a free-trade agreement with New Zealand and concluded negotiations on an agreement with the European Union.
- Estimated GDP gain
- About $140 billion by 2035
- Estimated export increase
- 6.2% by 2035
- US average tariff rate
- 10.7% in August, compared with 2.3% in 2024
- US goods imports
- Tariffs at the reported levels could reduce imports by around 15%
- Agreements in force
- EFTA, the UK and Oman agreements entered into force in 2025-26
- New Zealand and EU
- India signed an agreement with New Zealand and concluded EU negotiations
What people are saying
Using a large-scale model of the global economy developed by the World Trade Organisation, we estimate these agreements could add about $140 billion to India’s GDP in 2035, opening new markets, cutting import costs, fostering foreign direct investment and lifting productivity
We also consider two scenarios that could amplify the gains: realising further productivity benefits from a decade of reforms to strengthen manufacturing competitiveness, and enacting policies that help underemployed agricultural workers transition into manufacturing and services
Sources
PM Modi's free trade push could lead to $140 billion GDP gain for India
Govt's free trade push could lead to $140 billion GDP gain for India
US tariffs accelerate global trade realignment: How India’s FTAs could boost GDP
FTAs may add $140bn to India GDP by 2035, lift exports 6.2%: Bloomberg Economics
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