The long term rationale of the Indian economic reforms is clearly the attainment of international competitiveness. Whatever be the compulsions for macroeconomic stabilisation in the short term, success of the reforms will be not be decided by the achievement of macroeconomic balance. The broad architecture of the policy changes makes it clear that realignment of state - market relations directed at raising industrial efficiency is the main objective. The policy reforms, particularly those dealing with the external sector, have opened the economy to the processes of globalisation. There can be no doubt that these have the changed the rules of the game for Indian industry, and that its impact is being felt. External sector liberalisation, changes in the financial sector, and the signing of the GATT-WTO agreement have all contributed to an atmosphere of greater competition in domestic product and capital markets. Policy makers have drawn comfort from recent indicators of industrial production and export growth. There is little doubt that exports as a whole have grown much faster since the reforms. Between 1992-95, export volume has grown at 12.6% per year, which is more than double the world rate of 6.1%. The share of exports in GDP jLn 1994-95 was 9.2%, up from the 1990-91 figure of 6.2%. The rise in export share has occurred at a time when the GDP growth has itself increased. According to the Reserve Bank of India, " this is indicative of an outward orientation in the export sector, and a receding of the vent-for-surplus approach which characterised export activity in past years.