Eight seconds into this song, there is what I think is an electric guitar. Does anyone know how to produce that sound? Is it even an electric guitar?
This effect is called volume swell. It's achieved by fading in notes using your volume knob or a volume pedal.
Just a bit more info on cyco130's answer : 'Tis indeed a volume swell effect, and is an electric guitar.
The technique is to pluck the note with the volume turned down, then bring the volume in - either via a volume pedal or using the volume control on the guitar.
Some guitars make this easier because the volume control is easily reachable from where your hand would be when playing. A Fender Stratocaster is the classic example: it's easy to pluck a string then turn the volume up. Mark Knopfler of Dire Straits used this to good effect.
There are also effects which do this automatically. They detect when you have strick a note, and fade the sound in for you with settable speed - of- volume - increase.
If you'd like a cheap-but-effective example, the Zoom 505ii pedal has this built-in.