Foreigners can be forgiven for forgetting it, but there is more to India's economy than information technology outsourcing.

Witness the Forbes 40 India, the latest in our series of country rankings of the largest corporations. It is dominated by banking, energy and manufacturing groups.

India's big three business process outsourcing companies, Tata Consultancy Services [Get Quote], Wipro [Get Quote] and Infosys Technologies, together have only 40 per cent of the sales of Reliance Industries [Get Quote], the energy, chemicals and textiles conglomerate that tops our list.

India's top 40 companies

We do not gauge size by sales alone. We also consider profits, assets and market value to give a more rounded measure of size. That is why Reliance tops fourth-ranking Indian Oil [Get Quote] despite having half its sales.

The Top Ten
1	Reliance Industries Ltd
2	Oil & Natural Gas Corporation
3	State Bank of India
4	Indian Oil Corporation
5	National Thermal Power Corporation
6	ICICI Bank
7	Steel Authority of India Ltd
8	Tata Steel
9	Tata Consultancy Services
10	Tata Motors
11-40	The next 30

Reliance is the world's leading producer of polyester yarn and fiber and ranks in the top five to ten global producers of many petrochemical products. It accounts for 8 per cent of India's exports, worth $5 billion. That number that should grow significantly. Earlier this year, India liberalized its special export zone regulations to stimulate exports, a move that has been enthusiastically embraced by Reliance and others on our list such as Mahindra & Mahindra and Oil and Natural Gas Corp.

Over the past three decades, Reliance, which was founded by the late Dhirubhai Ambani, one of India's most iconic businessmen, has worked its way backward up the vertical integration chain from its original textiles business to oil and gas exploration via polyester, plastics, petrochemicals and oil and gas refining.

Reliance, like many of the other companies in our list, has benefited over that time from the gradual reform of an overprotected and quasi-socialist domestic economy into one that is more welcoming of foreign investment and that is increasingly engaged with the global economy.

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The resultant growth of the manufacturing and services sectors is driving the overall expansion of the economy, with gross domestic product growth for this year forecast to be 8 per cent -- though as always in still overwhelmingly rural India, a bad monsoon season can knock a couple of percentage points off the outcome.

There are other threats to the growth rate. A growing budget deficit is likely to reign in the government spending, which helped boost growth earlier this year (9.3 per cent year on year in the first quarter). That could be exacerbated if the 117 special export zones hollow out the country's tax revenue as big companies move in domestic-production operations to take advantage of tax exemptions.

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The greater danger is that the will to reform the economy gets weaker the further down the bureaucracy one gets from central government. And as always, there is the question of the country's infrastructure, often woefully antiquated or inadequate.

The same is true of soft infrastructure, notably the education system. Wipro is only the latest to warn that a shortage of trained employees is pushing up wage costs to a point that may constrain future growth. Like Tata Consultancy and Infosys [Get Quote], Wipro is looking at taking on the educational development itself by funding IT colleges to produce the workers it needs.

India also faces a risk of "jobless growth" if the economy can't grow fast enough to generate new jobs for a labor force that is both getting more productive and growing in size by 4 per cent a year. In that regard, it is energy and manufacturing industries that will have to be the engines of job growth, as IT services companies are just too small.

Methodology

We ranked the 40 biggest companies headquartered in the India using Thomson Financial's Worldscope database. We started with roughly 650 India companies that were publicly traded as of July 16, 2006. We created four lists of the 40 biggest companies for each of these metrics (each of them equally weighted): sales, profits, assets and market value. If a company qualified for one of the lists, it was eligible for the final 40.

We scored each company based on where it ranks on each list. If it does not appear on one of the lists, it does not receive any points for that category. We added up the points across all four metrics for a composite score, resorted them by that score and applied our Forbes 40 India rank to each company. All publicly traded subsidiaries (with greater than 50 per cent ownership of company stock and/or figures consolidated by the parent company) are excluded.