Rating agency Standard & Poor's today pegged India's gross domestic product (GDP) growth forecast at 8.6% for 2007-08.Subir Gokarn, chief economist, Standard & Poor's, Asia Pacific, said: "A key contributor to the performance would be the agricultural sector, which, on the basis of a good south-west monsoon, is expected to grow by 3.4%. The industrial sector, reflecting the cumulative impact of rising interest rates and rupee appreciation, will expand by 9.2% - somewhat slower than last year, but a still healthy rate reflecting continuing buoyancy in investment spending. Services are expected to grow by 10% based on strong domestic demand." The agency also said that the emerging markets have largely ignored the economic slowdown and financial turmoil in the United States (US). "Although economies are even more tightly linked by trade and financial flows than in the past, the US is no longer the only driver for growth in these economies.''In a mid-year review of the global economy, David Wyss, chief economist, S&P, said: "Emerging markets are now driving world growth - a turnaround from recent decades. Last year, China accounted for 30% of the increase in world GDP on a purchasing-power parity (PPP) basis compared with only 12% for the US. This year, slower US growth will reduce its share to only 9% while China's share will rise to 33% and India's to 12%."
