Performance of India’s External Sector
The external sector has strengthened over the years with balance of payments showing surplus. The large capital flows in 2003-2004 have resulted in a further accumulation of reserves, rendering reserve position comfortable as per various indicators of reserve adequacy.

• Foreign Exchange Reserves excluding gold and SDR stood at US$ 129.72 billion on Jan 8, 2005.
• India is already being seen as a new hub for exports of auto parts and other engineering goods and opportunities are expected to open in the textile sector.
• Trade liberalization is likely to counter some of the upward pressure on the exchange rate of the rupee.
• The Re/$ exchange rate revolved around 44 in the month of January and February 2005.

Direction of Trade

• The regional shares in sourcing of imports in 2001-02 reveal enhanced shares from all major regions.
• At the end of 2002 imports from SAARC region declined by 27.3% due to lower imports from Nepal and Pakistan.
• Indo-Pakistan trade also continues to be depressed with decline in our exports by 22.9% in 2001-2002.
• UAE has a share of 5.5% in India’s total foreign trade.
• USA as usual is leading with the total share of 11.1% in 2004-2005.
• Trade with ASEAN continues to be robust in 2004-2005 wih exports registering a growth of 50% and imports a rise of 21.2% in April-October period.
• Trade with SAARC region countries currently constitutes around 3% of India's total trade.

Equities and Markets

Equity market is a market where investors buy and sell securities providing ownership of a company’s share. It focuses on structuring and executing diverse equity financing transactions in the public and private markets for Corporates, Banks, Financial Institutions and the Government. India’s equity market is bouyant.

After the reforms, the markets have become transparent and accessible uniformly to everyone in the country, without bias to caste, religion, gender or location.

Millions of people who were once spectators of the stock market now became participants.