NEW DELHI: India?s external trade will touch $500 billion in three years, Union Commerce & Industry minister Kamal Nath said on Tuesday. According to current estimates, merchandise trade during 2005-06 would be $250 billion comprising imports to the tune of $150 billion and exports of $100 billion India?s economic engagement with the rest of the world during 2004-05 was $185 billion, he said today. The official export target for the current financial year is $92 billion but the government expects to touch the three-figure mark. Kamal Nath said exports increased 26.8 percent during July 2005 to $7.2 billion, compared to $5.7 billion in the same month of the previous fiscal. Exports during the first four months this fiscal increased 21.4 percent to $28 billion, compared to $23 billion in April-July 2004. Exports of iron ore, petro products, marine products, rice, garments, engineering goods and basic chemicals showed robust growth of over 25 percent. The minister felt growth in marine products was significant since the sector was affected by tsunami and anti-dumping duty imposed by the U.S. Imports during July 2005 grew 33 percent to $9.9 billion from $7.4 billion during the same month of the previous year. ?We see a very healthy trend since a significant portion of imports comprise capital goods, raw materials and intermediaries. Imports are fuelling growth of the Indian economy,? he added. While acknowledging that the Mumbai floods would lead to a dent in both exports as well as imports, Kamal Nath expressed the confidence that the Indian industry would overcome the disaster and maintain trade growth. The current increase in exports is despite high oil prices, depreciation of the dollar and artificial exchange rate of the Chinese Yuan, he added.