Answer: Because India produces a wide variety of goods and services and offers a very large market for imports.
- India exports textiles, gems and jewellery, engineering goods, chemicals, medicines, petroleum products and software services, which are in demand all over the world.
- It imports crude oil, gold, electronic goods, machinery and fertilisers in large quantities, so many countries depend on trade with India.
- Its large population gives both cheap skilled and unskilled manpower and a huge market for foreign goods.
- Its long coastline, ports and location on the Indian Ocean give it cheap sea routes; liberal trade policy and special economic zones have increased foreign trade.