India's growth rewarding amid global risks: Merrill Lynch

India offers one of most rewarding opportunities for growth in spite of recessionary conditions in the United States, wealth management group Merrill Lynch chief executive John Thain said Wednesday.

"I do not believe in the 'decoupling' theory but India, led by strong local demand, will be relatively less affected by the global credit crisis," Thain told reporters in Mumbai, India's commercial hub.

India, which is Asia's second fastest growing economy, is forecast to grow by more than eight percent in the year to March 2009.

"Despite investment risks which prevail across various markets, India offers one of the best opportunities for growth," Thain said.

"Continuation of rising food and energy prices, lower housing prices and higher unemployment will result in a pull-back from US consumers," Thain said.

"This could last for between 6 to 12 months," he added.

Merrill Lynch holds close to a 90 percent stake in the Indian firm DSP Merrill Lynch, which focuses on private equity, commercial real estate investments, brokerage and wealth management services in India.

"Considering that US economic growth is close to flat, India will continue to command more attention in terms of foreign direct investment, even if GDP growth moderates to eight percent," added Hemendra Kothari, chairman of DSP Merrill Lynch.

Kothari, however, said the level of asset write-offs by global banks would be lower than in the past 12 months.

CEO Thain also said that Merrill Lynch has no immediate plans to raise more capital, which at 44 billion dollars is close to a record high.

Merrill Lynch has written down more than 30 billion dollars in assets since 2007, as the US subprime mortgage-linked crisis spread beyond the United States to other markets.

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