The commerce minister Ramakrishna Hegde hopes for a turnaround in exports in the year to March 31, 2000, after growth slipped to close to zero last fiscal year against a targeted 20 per cent.

"The optimist in me sees brighter prospects for our exports compared to what has been happening over the last few years," he said while unveiling the export-import policy for the coming year.

Hegde said he hoped for 10 per cent growth but he refrained from setting a target after last year's dismal show. Analysts share his vision of a turnaround.

"Cyclical factors such as global export volumes are approaching their recovery phase," an economist at a foreign bank said. Commodity prices are at their lowest levels in over a decade, but the pressure on pricing could ease next year, analysts said.

"For much of last year, global deflationary pressures severelyundermined producer pricing power. The likelihood of perkier demand conditions in 1999 should enable better pricing," said Vasan Shridharan, treasury economist at Standard Chartered Bank.

Indian exports will be able to realise better dollar earnings, he added. Analysts said the new year will benefit from a lower base against which export growth will be measured and exports are technically poised for another boom cycle.

The International Monetary Fund (IMF) in December forecast world gross domestic product would be 2.2 per cent higher in 1999, maintaining the 2.2 per cent growth expected for 1998.

Asia's GDP would be up 4.3 per cent in 1999 as the region recovered from a financial crisis, said IMF, which estimated a 2.6 per cent rise for 1998.

Sluggish industrial output not withstanding, strong growth in agriculture would lead to higher exports next year, analysts said.

"Agricultural growth has picked up very well this year, and it comprises 20 per cent of our export basket," said an economist with aleading foreign institutional brokerage.

Agricultural output is expected to rise three to four per cent in 1998-99 against a fall of 1.5 per cent the previous year. Analysts said they hoped the composition of Indian exports, said to be at the lower end of the value-added chain, would become more technology-intensive after the Exim policy revealed Special Import Licences (SIL) for the export of branded goods.

Any hopes that the government would hint at a weaker currency to boost exports were laid to rest when Hegde said he did not believe a rupee devaluation was the solution. Exporters agreed with him.

"For us even if the rupee depreciates, the export price in rupee terms gets adjusted," said Indrajit Deb, wholetime director of Williamson Financial Services Group.

The Indian rupee has avoided the sharp and contagious depreciations suffered by Asian currencies over the past two years. But the rupee fell before the currency crisis and, if the 1990s are taken together, it has tended to keep pace with itsAsian competitors.