India’s expanding network of free trade agreements could add $140 billion to $170 billion to GDP by 2035, according to a Bloomberg Economics report released on Monday, October 12, 2026. FTAs already in force would lift India’s GDP by 1.2% above baseline by 2035, rising to 1.7% if the EU and New Zealand agreements are implemented from 2027.
The estimate, reported by Business Standard on October 12 and 13, comes as the average tariff on Indian goods sold to the United States has risen to 11.6% from 2.4% in 2024. The authors used a computable general equilibrium model of the global economy developed by the World Trade Organization.
How Much Could India’s FTAs Add to GDP?
The report breaks the gain into stages. Agreements already in force raise GDP by 1.2% by 2035. Adding the EU and New Zealand deals from 2027 takes the gain to 1.7%, or about $140 billion at constant 2025 dollars. A US deal would add another 0.2 percentage points. If talks with the Eurasian Economic Union, the Gulf Cooperation Council and Israel conclude in the next few years, GDP could be 2.1% higher, or about $170 billion. Indian exports could be almost 10% above baseline if all deals are implemented.
Which Agreements Are Driving the Estimate?
Agreements with EFTA, the UK and Oman entered into force in 2025-26, adding to earlier deals with Australia and the UAE. India has also signed an FTA with New Zealand and concluded EU negotiations, and it is pursuing talks with the Eurasian Economic Union and has sought an agreement with the GCC.
The model assumes India eliminates industrial tariffs and halves agricultural tariffs, phased in over ten years, and that non-tariff measures fall 25% over 15 years. It also assumes FDI commitments of $100 billion over 15 years for EFTA, of which about $35 billion is additional, and $20 billion for New Zealand.
What Do the US Tariffs Mean for Indian Exports?
By 2035 the tariffs are estimated to cut Indian goods exports to the US by about one-fifth. Because less than 2% of India’s output depends on US markets, the report expects the effect on GDP to be negligible. It notes that the average US tariff rate was about 10.7% in August 2026, up from 2.3% in 2024.
What Does the Government Say?
Commerce and Industry Minister Piyush Goyal has said India is negotiating with at least eight to nine more country groups and individual nations that together account for about $15 trillion of GDP. He said India has concluded nine FTAs with 38 developed countries in the past four and a half years, covering economies with a combined GDP of $60 trillion.
Market and Trade Reaction
No separate market or industry-body reaction to the Bloomberg Economics estimate was found in the reports reviewed. The report also projects GDP growth of 6.9% in 2026 and 7.4% in 2027, inflation of 4.5% in 2026 and 5.3% in 2027, and a repo rate of 5.50% in 2026 and 5.75% in 2027.
What Happens Next?
Gains depend on implementation of the EU and New Zealand agreements from 2027 and on the outcome of talks with the EAEU, GCC, Israel and the US. The report also flags upside scenarios, including a roughly 2% cut in manufacturing production costs, which could add about 0.5 percentage points to GDP gains.
Frequently Asked Questions
How much could India’s FTAs add to GDP by 2035?
Bloomberg Economics estimates $140 billion to $170 billion, equal to 1.7% to 2.1% of GDP, depending on which agreements are implemented.
What is the US tariff on Indian goods in the estimate?
The report puts the average tariff on Indian goods sold to the US at 11.6%, compared with 2.4% in 2024.
Will US tariffs hurt India’s GDP?
Exports to the US could fall by about one-fifth by 2035, but because less than 2% of India’s output depends on US markets, the report expects a negligible GDP effect.
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