US Trade Deal to Boost India's GDP Growth by 20-30 BPS; FY27 Growth Could Exceed 7%

India’s weighted average tariff now stands at 10.7 percent, excluding Section 232 tariffs and exemptions, lower than most South Asian economies and on par with most Southeast Asian economies except Malaysia, which stands lower at 9.4 percent.

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Moneycontrol•03-02-2026, 16:55

US Trade Deal to Boost India's GDP Growth by 20-30 BPS; FY27 Growth Could Exceed 7%

•Economists predict India's GDP growth will get a 20-30 basis point boost from the new US trade deal, potentially exceeding 7% by FY27.
•The agreement, announced by US President Donald Trump, reduces reciprocal tariffs from 50% to 18%, making Indian exports more competitive.
•This tariff reduction frees up nearly $50 billion in Indian exports to the US, benefiting labor-intensive sectors like gems and jewelry, textiles, and marine products.
•CareEdge Ratings, Goldman Sachs, Moody's, Nomura, and Barclays all project positive impacts, with some raising GDP growth forecasts.
•The deal is expected to revive foreign investment, stabilize the rupee, and improve investment sentiment, contributing to India's economic optimism.

Why It Matters: The India-US trade deal is set to significantly boost India's GDP growth and export competitiveness.

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