ment.
Higher limits on foreign direct investment were permitted in a few
key sectors, such as telecommunications. However, tariff spikes in
sensitive categories, including agriculture, and incremental
progress on economic reforms still hinder foreign access to India's
vast and growing market. Privatization of government-owned
industries remains stalled and continues to generate political
debate; populist pressure from within the UPA government and from
its Left Front allies continues to restrain needed initiatives. The
economy has posted an average growth rate of more than 7% in the
decade since 1997, reducing poverty by about 10 percentage points.
India achieved 8.5% GDP growth in 2006, and again in 2007,
significantly expanding production of manufactures. India is
capitalizing on its large numbers of well-educated people skilled in
the English language to become a major exporter of software services
and software workers. Economic expansion has helped New Delhi
continue to make progress in reducing its federal fiscal deficit.
However, strong growth combined with easy consumer credit and a real
estate boom fueled inflation concerns in 2006 and 2007, leading to a
series of central bank interest rate hikes that have slowed credit
growth and eased inflation concerns. The huge and growing population
is the fundamental social, economic, and environmental problem.

Indian Ocean
The Indian Ocean provides major sea routes connecting
the Middle East, Africa, and East Asia with Europe and the Americas.
It carries a particularly heavy traffic of petroleum and petroleum
products from the oilfields of the Persian Gulf and Indonesia. Its
fish are of great and growing importance to the bordering countries
for domestic consumption and export. Fishing fleets from Russia,
Japan, South Korea, and Taiwan also exploit the Indian Ocean, mainly
for shrimp and tuna. Large reserves of hydrocarbons are being tapped
in the offshore areas of Saudi Arabia, Iran, India, and western
Australia. An estimated 40% of the world's offshore oil production
comes from the Indian Ocean. Beach sands rich in heavy minerals and
offshore placer deposits are actively exploited by bordering
countries, particularly India, South Africa, Indonesia, Sri Lanka,
and Thailand.

Indonesia
Indonesia, a vast polyglot nation, has been undergoing
significant economic reforms under President YUDHOYONO.