In its report titled 2010 World Economic Situation and Prospects, the global body said rapid expansion in services and manufacturing sectors were the major reasons for India's growth.
The United Nations has hailed India for leading the economic recovery in South Asia and said the impressive growth in the country along with that in China is expected to result in a 1.5% increase in global demand for oil during the current financial year.
In its report titled 2010 World Economic Situation and Prospects, the global body said rapid expansion in services and manufacturing sectors were the major reasons for India's growth.
"South Asia proved more resilient to the global economic downturn than other developing regions. The recovery is led by India, where growth accelerated to 7% in the second half of 2009 due to a rapid expansion in manufacturing and in services sector," the report by the UN's department for economic and social affairs said.
It said demand for oil is expected to grow by 1.5% in 2010, mainly due to the measured increase in demand from India, China and other major developing countries.
The OPEC (Organisation of Petroleum Exporting Countries) had earlier pegged global oil demand at 85.38 million barrels per day.
The UN projected India's economic growth rate at 7.9% in 2010, while forecasting 8.1% growth rate for 2011.
"A recovery of exports and a further strengthening of investment and consumption demand is expected to lift growth in India to 7.9% in 2010 and 8.1% in 2011," the report added.
Commenting on inflation in India, it said the Reserve Bank has already shifted its focus from supporting the recovery process to containing price increases.
The average rate of inflation in South Asia, however, will remain constant in 2010, the UN said.
"Although the average rate of inflation is forecast to remain constant in 2010, pressures remain elevated in most countries, especially for food products and utilities," it said.
About job losses, the UN said the labour market was likely to witness a marked improvement in next two years in the region.
"Labour markets across South Asia deteriorated in 2009 as regional unemployment rates edged up and the proportion of workers in vulnerable employment conditions increased. These adverse trends are expected to be partly reversed in 2010 and 2011," it added.
The report projected that the average growth is expected to accelerate to 6.5% in 2010 and 6.9% in 2011 in the region.
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