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'India to continue witnessing dynamic growth in 2008'

A UN report says the growth will be driven by investment in the manufacturing and service sectors and will be insulated from weakness in global economy.

india Updated: Jan 10, 2008 12:40 IST

India will continue to witness dynamic growth in 2008, driven by investment in the manufacturing and service sectors, and will be "largely insulated from weakness in the global economy," a new United Nations report has said.

The Asia-Pacific region as a whole is also likely to continue to see strong economic growth this year, despite uncertainties posed by a slowing United States economy, it predicted.

"Key Economic Developments and Prospects in the Asia-Pacific Region 2008" -- published by the UN Economic and Social Commission for Asia and the Pacific (ESCAP) -- stated that the region's resilience will be underpinned by strong growth in India and China and high commodity prices.

"Asia-Pacific economies are well prepared to manage continued uncertainty in the external environment over the coming months," Chief ESCAP economist Ravi Ratnayake said on Thursday at the launch of the report in Bangkok.

"The region's main strength lies in healthy macroeconomic fundamentals -- countries have the room to adopt supportive fiscal and monetary policies if faced with significantly declining export growth, financial market volatility or inflationary pressures," he added.

Developing economies in Asia posted a growth rate of 8.2 per cent in 2007 and is expected to grow at a "slightly lower but still robust" rate of 7.8 per cent this year.

Despite the upbeat forecast, the report warned that an unravelling of the United States sub-prime mortgage problem and a slowing of the US economy could pose risks for Asian economies.