The federal government on Thursday released a report, An India Economic Strategy to 2035, written by former foreign affairs boss Peter Varghese.

Mr Varghese argues that over the next two decades no single market will offer more growth opportunities for Australia than India.

By 2035, India will overtake China as the world's most populous country.

It is also poised to become the third-largest economy, after China and the United States.

The report said education should be the flagship sector "because of a combination of Australian expertise, the scale of India's education deficit and the way in which an education and training demand weaves its way through virtually every sector of the Indian economy".

India has an ambitious target of upskilling 400 million Indians.

"Australia's education relationship with India needs to focus on a message of quality, on postgraduate and research collaboration, on science and innovation, on forging partnerships to deliver cost-effective vocational education in India and partnering with India in the digital delivery of education," Mr Varghese said.

As well as education, there should be a focus on three "lead sectors" (agribusiness, resources and tourism) and six "promising sectors" (energy, health, financial services, infrastructure, sport, science and innovation).

The targets set out in the report would see Australian exports to India grow from $14.9 billion in 2017 to around $45 billion, and outward Australian investment to India rise from $10.3 billion to over $100 billion.

"Australia should set itself the goal by 2035 to lift India into its top-three export markets, to make it the third largest destination in Asia for Australian outward investment, and to bring it into the inner circle of Australia's strategic partnerships and with people-to-people ties as close as any in Asia," the report said.

Trade Minister Steve Ciobo said the government was considering the report.

Australian Associated Press