Buoyed by a booming domestic economy and increasing outward orientation of Indian economy, India's share in the world trade has increased from 1.1 per cent in 2004 to 1.5 per cent in 2006. While India's share in world merchandise trade rose to 1.2 per cent from 0.9 per cent, its share in world service trade was at a much higher level at 2.7 per cent in 2006 as against 2 per cent in 2004.

In fact, India's global economic engagement in 2006, covering both merchandise and services trade, was worth US$ 437 billion, up by a record 72 per cent from a level of US$ 253 billion in 2004. Moving forward, it is estimated that by 2009, India's share in world trade is likely to reach 2 per cent, along with a 1.5 per cent share in world merchandise trade.

Exports

The competitive advantage that India enjoys across a range of sectors has led to rapid increase in India's exports. Back on the robust 23.88 per cent growth in exports during 2006-07, cumulative value of exports for April-February 2007-08 grew by 23 per cent to total US$ 138.4 billion as against US$ 112.6 billion in the corresponding period last year.

• Spices exports during April-February have increased by 16 per cent in quantity, 19 per cent in value terms to reach US$ 940.47 million from US$ 700.77 million
• Jewellery exports rose 22.62 per cent during April-February 2007-08 compared to the corresponding period last fiscal to reach US$ 18.74 billion.
• Automobile Exports grew by 21.03 percent during April-February 2007-08 over the same period last fiscal, with Two Wheelers growing by 31.16 percent and Commercial Vehicles by 18.55 percent.
• Software and services exports grew by 26.33 per cent to register revenues of US$ 27.49 billion during April-December 2007 as against US$ 21.76 billion during same period last year.
• Foreign tourist earnings have increased by 25.8 per cent during the January-November to touch US$ 7.23 billion compared to US$ 5.74 billion in the same period last year.

FDI

India continues to be the second most attractive destination for global foreign direct investments (FDI), says the A T Kearney FDI Confidence Index 2007.

Reflecting the continuing pace of expansion of domestic activities, positive investment climate, and long-term view of India as the investment destination, FDI equity inflows increased by almost five-fold to US$ 15.7 billion in 2006-07 from US$ 2.2 billion in 2003-04. As a result, FDI contribution in India's GDP has increased from 0.77 per cent to 2.31 per cent. The inflows continues apace, with a growth rate of 37 per cent during April- December 2007 to total US$ 12.69 billion as against US$ 9.27 billion in the corresponding period in 2006.

Consequently, India's cumulative FDI inflows have reached US$ 50.62 billion from April 2000 to December 2007. Services sector has been at the forefront in attracting FDI inflows, accounting for 19.84 per cent of the total inflows. It is followed by Computer hardware and software and telecommunications. Region-wise Mauritius was the dominant country in making investment into India, followed by USA and UK.