India's exports to Germany are likely to touch Rs 14,560 crore (euro 2.8 billion) in 2003, according to the Indo-German Export Promotion Project.

Indian exports to Germany recorded an 8.3 per cent increase in January-March 2003 as compared to the same period last year.

However, German exports to India during the first quarter of the current year declined by 15.3 per cent.

"This dip is mainly due to the steep increase in the exchange rate of euro," IGEP said, adding India is likely to record a surplus in the bilateral trade.

The Indo-German bilateral trade is expected to cross the figure of euro 5 billion (approximately Rs 26,000 crore) during 2003 (January-December).

The total Indo-German bilateral trade in 2002 stood at euro 4.94 billion (Rs 23,000 crore).

IGEP termed the extent of last year's bilateral trade as a "big achievement" in light of the shrinking turnover in Germany's retail trade and the world economy.

"The main reason for the rise in India's exports to Germany is the further diversification of the Indian export market," D Kebschull, director, IGEP, said.

The exports of industrial machinery, electronics, chemical products, pharmaceuticals and bulk drug have grown considerably. They account for 25 per cent of the export earnings from Germany. Pharmaceuticals and bulk drugs have grown by more than 50 per cent in 2002.