NEW DELHI, India (AP) _ Kidnapping, for politics and profit, is India's newest growth industry.

At least 500 people have been abducted this year. Most were freed in exchange for ransom or imprisoned political comrades.

''The kidnappers have realized there is no other crime that fetches such easy gains,'' said Ganga Prasad Joshi, a national police official.

Almost daily, state and federal authorities debate whether to strike deals with kidnappers. In most cases, they yield to the demands.

''The government has the spine of a banana,'' said K. R. Malkani, vice president of the right-wing opposition Bharatiya Janata Party. ''The government is completely confused. They start something, then they stop midway.''

Police say criminal gangs abducted 390 people in New Delhi alone during the first nine months of 1991. Many other kidnappings for ransom are unreported.

Ransom demands range from the equivalent of $39,000 to $195,000, but police say the amount paid usually is a fraction.

Police sy many families make their own deals with kidnappers, without involvement of authorities.

''In ransom kidnapping, the relatives take the initiative,'' Joshi said. ''They have greater stakes and they are so desperate that police do not even come into the picture.''

In the largest single kidnapping, five multimillionaire diamond merchants from Bombay were taken from a New Delhi hotel in mid-Septmeber and emerged from a house in the capital 18 days later. News reports said the kidnappers left them unguarded after receiving a large ransom from their families.

More than 100 people have been abducted this year by separatist militants or communist guerrillas. Most were seized in Kashmir, where Muslim militants are fighting for independence; the northeastern state of Assam, where ethnic insurgents want a separate nation, and southern Andhra Pradesh state, where communist guerrillas seek land rights for peasants and indigenous tribes.

''The militants know the government is occasionally prepared to bend, so they get ... maximum output from minimum input,'' Joshi said.

Militants in Assam snatched 49 people from state-owned oil fields and tea plantations last summer to trade for jailed comrades. Six still are missing.

Kidnappers killed three engineers, one a Soviet citizen, who worked for the state Oil and Natural Gas Commission. More than 47,000 company employees struck for six days to demand freedom for the other captives, and $58 million in oil production was lost.

Senior police officials say privately the government should refuse to bow to political blackmail because it encourages the militants and demoralizes the security forces. They add, however, that the Indian public would not accept the sacrifice of hostages.

In December 1989, the government released five Kashmiri militants in exchange for Rubaiya Saeed, whose father was the federal home minister.

''It was a watershed in the history of India's separatist movements,'' said Malkani, the opposition politician. ''The subsequent two governments have not showed any more courage of conviction.''

This year's kidnap victims in Kashmir include two Swedish engineers, who were allowed to slip away after international pressure, and five Israeli tourists taken from a houseboat on a mountain lake. The Israelis escaped, killing one kidnapper and losing one of their own.

In Andhra Pradesh, Maoist guerrillas regularly kidnap police officers, landowners and politicians to get jailed compatriots freed. Many of the hostages die.

''We are getting the worst of both the worlds,'' Malkani said. ''The hostages are being killed and many terrorists are walking away scot-free.'' said Malkani.