OECD said China will grow 10 per cent against 11.9 per cent in 2007 as exports slip amid a world slowdown and anaemic US expansion, the forecast in its bi-annual Economic Outlook.
India's expansion will fall to 7.8 per cent in 2008 from 8.7 per cent the previous year, partly due to higher interest rates, said the report from the grouping of 30 industrialised nations, which does not include the two Asian giants.
Rising inflation posed a key risk in India and in China, where the devastating earthquake in Sichuan province, a key farming area, could push up food prices, the OECD added.
Annual inflation in both countries is over eight per cent as the prices of staple foods and crude oil soar, forcing India to announce today a hike in subsidised fuel prices.
The OECD expects Indian growth to speed up in 2009 but said the principal risk to its forecasts was "inflation not moderating" despite hikes in borrowing costs and other steps by the Indian authorities to cool prices.
"Growth in the emerging markets, while moderating, remains strong, especially in China," the report said, adding the odds were improving that global financial market turmoil had passed its peak.
Asian stock markets began sliding last year after a ballooning default crisis among so-called "subprime"