India is one of the world’s fastest-growing (and most stable) economies, with strength in its agriculture, textile, and service sectors. Services are its main source of economic growth, accounting for over half of India’s output with less than a third of its labor force. And India is on track to open up its retail, insurance, and banking sectors to more foreign investment.

The Indian economy has been growing an average of 7 percent over the last 10 years, reducing poverty by about 10 percent over the same period. India had GDP growth of 8.5 percent in 2006, 9 percent in 2007, and 7.3 percent in 2008.

Since the election victory of the free-market-oriented Congress Party, the Bombay Stock Exchange has taken off. I expect billions of dollars’ worth of investment capital to flow into Indian stocks, and India’s economy is going to continue to soar.

You owe it to yourself to invest in India. Keep in mind, though, that developing markets tend to be volatile, so put only a small portion of your portfolio into any emerging market.

My favorite way to play India is with the PowerShares India Fund (PIN). This exchange-traded fund (ETF) has excellent profit potential. It has seen a great short-term gain of 32 percent since I first recommended it on April 9th. You don’t usually see big profits that fast, and it’s on track for more.

The fund is traded in the U.S., holds a nice basket of Indian stocks, and seeks to mirror the Indian stock market as measured by the Indus India index.

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