Comparable Analysis On The Economic Performace Of FDI In China And India

China and India, two fastest growing economies in Asia, are considered as themost favored invested countries. In the development course, the economic benefitwhich Foreign Direct Investment (FDI) brings to the two countries is obvious to all.However, the effects of FDI in two countries are quite different. So, the comparativestudy on the utilization of FDI between China and India is of great practicalsignificance.This essay firstly introuduces the theory on the impact of FDI to investmentdestinations which proves that FDI makes great contributions to economydevelopment.Then, based on data evidence, I would compare by many dimensionsbetween China and India,such as the absorption scale of FDI, the absorption source ofFDI, the structure of industry, and the way of FDI inflow and outflow, in order to tellthe qualitative difference between two countries.Then, I will analyse the cause and theeffects of those differences according to quantative analysis. Finally, I find that,currently, China has more advantage on utilization of FDI due to its large FDI base;however, India has more potential in the future due to its large multiplier effect. In theend, I will give some policy suggestions of absorbing and making use of FDI, withgood practice of two countries.