India's Trade Deals Could Add $140 Billion to GDP by 2035: What the New Study Says
A Bloomberg Economics report (October 2026) estimates that India's free trade agreements (FTAs) already in force, plus those agreed with the European Union (EU) and New Zealand, could add about $140 billion (in constant 2025 dollars) to India's GDP by 2035.
That means GDP about 1.7% higher and export volumes about 6.2% higher than in a world without these deals. FTAs already in force alone add 1.2% to GDP and 4% to exports.
An interim trade deal with the US would lift the GDP gain to 1.9% (exports 7.8%). Concluding talks with the Eurasian Economic Union (EAEU), the Gulf Cooperation Council (GCC) and Israel would raise it to about $170 billion, or 2.1% (exports 9.2%).
The study uses a computable general equilibrium (CGE) model developed by the World Trade Organization (WTO). A CGE model is a computer model of the whole economy that tracks how a change in one place (like a tariff cut) spreads to all sectors.
It notes that the average US tariff on Indian goods rose to 11.6% in August 2026 from 2.4% in 2024, which could cut Indian goods exports to the US by about one-fifth by 2035. But the hit to total GDP would be small, since less than 2% of India's output depends on US markets.
Domestic reforms add more: a 2% cut in manufacturing costs could add about 0.5 percentage point to GDP gains, and moving workers from farming (over 40% of the workforce) to industry and services could add about 2 percentage points.
Free Trade Agreements: Concept and WTO Framework
A Free Trade Agreement (FTA) is a deal between two or more countries to remove or sharply cut import taxes (tariffs) on most of the goods they trade with each other. Each country still keeps its own tariffs for countries outside the deal. Modern FTAs also cover services, investment, digital trade and rules on standards. India often uses other names for them, such as CEPA, CECA or TEPA, but the core idea is the same.
The study measures how much these FTAs could add to India's GDP and exports. It also shows that the deals help most when paired with domestic reforms, because a deal only opens a door; firms must be competitive enough to walk through it.
Eurasian Economic Union (EAEU)
The Eurasian Economic Union is a group of five former Soviet countries that have joined their economies into a single market: Russia, Kazakhstan, Belarus, Armenia and Kyrgyzstan. Goods, services, money and workers move freely inside it, and all members charge the same import tariff to outsiders. Because of this common tariff, a country like India must sign one trade deal with the whole union, not with each member separately.
The study counts a completed India-EAEU deal as part of the "extra" gains that could take India's total benefit from about $140 billion to about $170 billion by 2035.
Gulf Cooperation Council (GCC)
The Gulf Cooperation Council is a regional group of six Arab monarchies on the Arabian Peninsula: Saudi Arabia, the UAE, Qatar, Kuwait, Bahrain and Oman. It was set up in 1981 with its headquarters in Riyadh. The GCC is one of India's biggest trading partners and the source of much of India's oil and gas. Millions of Indians work in GCC countries and send money home.
The study lists a completed India-GCC FTA as one of the deals that could add further gains, pushing the total GDP boost to about 2.1% by 2035.
- Estimated GDP gain by 2035: $140 billion (1.7% of GDP); exports +6.2% (FTAs in force + EU + New Zealand, from 2027)
- FTAs in force alone: GDP +1.2%, exports +4%
- With a US interim deal: GDP +1.9%, exports +7.8%
- Adding EAEU, GCC and Israel deals: about $170 billion (2.1%), exports +9.2%
- Average US tariff on Indian goods: 11.6% (August 2026) vs 2.4% (2024)
- Investment commitments modelled: $100 billion over 15 years (EFTA), $20 billion (New Zealand)
- Model used: WTO's computable general equilibrium (CGE) model
- India's deals in force: UAE and Australia (2022); EFTA, UK and Oman (2025-26)
- Over 40% of India's workforce is in agriculture