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The paper examines the potential benefit of a U.S.-India free trade agreement (FTA). FTAs are expected to not only increase trade but also improve the structural composition of trade towards higher valued goods and services. In turn, these improvements can raise real GDP growth, create employment opportunities, support infrastructure investment, and improve other development indicators. We use a case study approach for our analysis. Specifically, we examine India’s FTAs with advanced economies as well as U.S. FTAs with emerging markets to speculate about the changes in India’s export position with the U.S. Through this we draw conclusions about the long-run potential benefits of a U.S.-India FTA. We will also analyze the impact of the possibility and the implications of an FTA due to the COVID-19 crisis.

International Trade, Open Economy Macroeconomics