New Delhi, Feb 27 (IANS) More domestic reforms are required to maintain and further accelerate the current dynamism in exports on a long-term basis, according to the Economic Survey 2006-07.

This, the survey states, calls for reducing constraints like infrastructure bottlenecks, outdated and inflexible labour laws, small-scale industry reservations and high transaction costs. It also calls for a calibrated policy of phasing out export incentive schemes coupled with lowering basic custom duty.

Exporters, in turn, need to place more emphasis on non-price factors like product quality, brand image, packaging, delivery and after-sale services, states the survey, tabled in the Lok Sabha Tuesday by Finance Minister P. Chidambaram.

It also recommends a more aggressive push to foreign direct investment (FDI) in export industries, which will not only increase the rate of investment in the economy but also infuse new technologies and management practices in these industries and thereby increase exports.

India's merchandise exports increased by 36.3 percent in April-December 2006, thus gaining in momentum to reach a level of $89.5 billion.

Exports during 2005-06 also grew at a healthy rate of 23.4 percent to cross the $100 billion mark. India continued to maintain its share of one percent in world merchandise exports during the first eight months of 2006, which was attained in 2005 after remaining unchanged at 0.8 percent in 2003 and 2004.

It is targeted to reach 1.5 percent of world exports by 2009.

The survey emphasises that India's significant export growth in recent years was on account of a host of favourable external developments and domestic policy initiatives.

Improved global growth and recovery in world trade aided the growth of Indian exports. The opening up of the economy and corporate restructuring has enhanced the competitiveness of Indian industry.

The buoyancy of exports was driven by the resurgence in the manufacturing sector and sustained demand from major trading partners, according to the survey.

"Trade policy reforms, continued trade promotion, market diversification and trade facilitation efforts seem to have paid good dividends," the document notes.

Imports grew by 36.3 percent in April-December 2006, which was substantially contributed by the growth in petroleum, oil and lubricant imports at 39.2 percent due to high crude oil prices.

Non-oil import growth decelerated to a moderate 18.7 percent in the first nine months of the current fiscal year, primarily because of high bullion prices leading to a decline in import of gold and silver in first few months.