Hi Dinesh,
API aka Application programming interface
IN detail an interface which enable external or internal sources to interact with your program
In web its called webservices also.
So For API or webservices you could do following 2 things
1> Consume any API from other
2> Create an API for other
if you want to consume API provided by others then you can use curl.
some of them provide plugins already in php to consume their API or webservices.
If you want to create API then two architecture are followed in present condition
1> SOAP 2> REST
Example for ReST API
Hope you Get clarified about API