New Delhi, April 25: India is likely to post a growth rate of 7.2 per cent this year and 7.3 per cent next year while China will continue on a higher trajectory at 8.5 per cent and 7.8 per cent in the two years, says a United Nations survey released today.

The survey by the UN?s Economic and Social Commission for Asia and the Pacific (Escap), however, predicts a slowing down in the growth rate of both the Asian giants from the levels achieved during 2003 as soaring international oil prices will have a negative impact on economic activity.

While China had clocked a 9.3 per cent and 9.5 per cent growth rate during 2003 and 2004 respectively, India had recorded an 8.5 per cent and 6.9 per cent growth rate in the two years.

?Assuming no major internal or external shocks and no political instability, India should be able to sustain real GDP growth rates in the range of 7 to 7.5 per cent in 2005-07,? the survey states.

The growth would be supported by a 2-4 per cent growth in agriculture coupled with 7.5-8 per cent growth in industry and 8.5 per cent in services, it adds.

Escap projects the rest of the Asia-Pacific region as a whole to expand by 6.2 per cent during 2005 due to the adverse impact of the tsunami tragedy and oil price shocks.

India is also expected to grow faster than its neighbours Pakistan (expected to grow by 6.6 per cent), Sri Lanka (5-6 per cent), Bangladesh (5.2 per cent), Nepal (4 per cent) and Iran (7.1 per cent). Only Bhutan is slated to grow faster than India and clock an 8 per cent GDP growth.

Escap has warned that external and regional environment weakness for the Asia-Pacific region looms large with a possible rise in inflation if global oil prices remain high for the rest of the year.

The Escap projections are based on average oil prices at $38 a barrel and the growth rate could be choked by another 0.5 per cent if global crude prices continue to remain over $50 a barrel.

Lauding the improvement in India's external trade and balance of payments situation, Escap said ?there was a major shift in favour of long-term and non-debt creating financial flows such as FDI and portfolio (FII) investment.?

Foreign investment inflows increased substantially from $4.5 billion in 2002 to $14.5 billion in 2003 attracted by sound macro-economic environment and host of other favourable factors, it said.