Abstract: The present invention provides a clear stable ophthalmic composition comprising (a) an anti-infective agent; (b) a steroidal anti-inflammatory agent; (c) a complexing agent capable of forming an inclusion complex and (d) other pharmaceutically acceptable excipients in a liquid vehicle such that the composition is free of any other complexation enhancing polymer and such composition when stored at room temperature for one year does not show any precipitation over the storage period.