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MUMBAI — Yonatan Gher and his partner, who are Israeli, plan eventually to tell their child about being made in India, in the womb of a stranger, with the egg of a Mumbai housewife they picked from an Internet lineup.

The embryo was formed in January in an Indian fertility clinic about 2,500 miles from the couple’s home in Tel Aviv, produced by doctors who have begun specializing in surrogacy services for couples from around the world.

“The child will know early on that he or she is unique, that it came into the world in a very special way,” said Mr. Gher, 29, a communications officer for the environmental group Greenpeace.

An enterprise known as reproductive outsourcing is a new but rapidly expanding business in India. Clinics that provide surrogate mothers for foreigners say they have recently been inundated with requests from the United States and Europe, as word spreads of India’s mix of skilled medical professionals, relatively liberal laws and low prices.

Commercial surrogacy, which is banned in some states and some European countries, was legalized in India...