Higher oil prices have affected the trade deficit

Figures showed exports rose 24% to $80bn (�42.7bn) in the year to March - but soaring oil imports meant India still ran up a trade deficit of $25bn.

The country imports more than 70% of its oil needs and while demand has increased, so has the price of crude.

Economists say a global downturn would have an impact on exports this year, with a 15% rise being forecast.

Still, the Indian government raised its exports target to �92bn from �88bn.

The government's data showed imports rose 34% to $105bn last year - with oil making up $29bn of that figure.

Maintaining competitiveness

Officials said India was looking to boost its share of world trade - which currently stands at less than 1% - over the next four years and predicted an extra 10 million jobs could be created.

While we may be able to maintain competitiveness, Indian exports are vulnerable to the global growth cycle Manas Paul, Securities Trading Corporation of India

"This growth comes despite the strengthening of the rupee, weakening of the dollar and the impact of the increase in oil prices," said Commerce Minister Kamal Nath.

Exports, which account for about 10% of India's national output, have been growing on the back of demand from the US and Europe - with steelmakers boosted by orders from China.

But imports have also been helped during the year as the country's improving economic situation gave consumers greater spending power.

Economists said the trade deficit looked likely to widen next year, with oil prices expected to remain high and amid a slowdown in the world economy.