ECONOMIC GROWTH OF INDIA AND CHINA STRATEGIES DIFFERENCES ABSTRACT

The purpose of this study is to study how India and China has evolved From ashes to phoenix. It involves ground research work , suitable research methodology for different areas of both the economies .This data we have collated from research work conducted in the last 5 years . Indian economy has continuously recorded high growth rates and has become an attractive destination for investments. "Today India is among the most attractive destinations globally, for investments and business and FDI had increased over the last few years. India's economic growth is expected to remain robust in 2012 and 2013e , despite likely headwind of double-dip recessions in Europe and the US, according to a United Nations' annual economic report World Economic Situation and Prospects 2012. The Indian economy is expected to grow between 7.7 per cent and 7.9 per cent this year, as per the report. Just like India ,The growth of the Chinese economy in the past few decades since economic reform in 1979 has been one of the wonders of modern economic development. China has experienced unprecedented growth in the past thirty years, with GDP rising on average by 9.5% per year over that period. Indeed, China currently has the fourth largest GDP, measured in nominal US dollars, with the 2006 figure standing at US$2.68 trillion .

INTRODUCTION
India is the second most preferred destination for foreign investors, according to the report 'Doing Business in India' by Ernst & Young. The report explores India's key sectors, investment climate, funding scenario, laws and regulations, to aid companies that are doing, or plan to do business in India. The wealth of high net worth individuals (HNIs) in India, is set to grow by a compounded annual growth rate (CAGR) of 23 per cent over the next four years and will touch a staggering Rs 249 trillion (US$ 5.05 trillion), highlighted a report by Karvy Private Wealth - the wealth management arm of the financial services firm Karvy Group.

India has emerged as the world's top recipient of officially recorded remittances for the fourth straight year. India is expected to receive US$ 58 billion this year, followed by China, and Mexico, as per the latest issue of the World Bank's Migration and Development Brief.

As far as China is concerned , It became the world's largest exporter. Reforms began with the phasing out of collectivized agriculture, and expanded to include the gradual liberalization of prices, fiscal decentralization, increased autonomy for state enterprises, creation of a diversified banking system, development of stock markets, rapid growth of the private sector, and opening to foreign trade and investment China has implemented reforms in a gradualist fashion. In recent years, China has renewed its support for state-owned enterprises in sectors it considers important to "economic security," explicitly looking to foster globally competitive national champions. After keeping its currency tightly linked to the US dollar for years, in July 2005 China revalued its currency by 2.1% against the US dollar and moved to an exchange rate system that references a basket of currencies. From mid 2005 to late 2008 cumulative appreciation of the renminbi against the US dollar was more than 20%, but the exchange rate remained virtually pegged to the dollar from the onset of the global financial crisis until June 2010, when Beijing allowed resumption of a gradual appreciation. The restructuring of the economy and resulting efficiency gains have contributed to a more than tenfold increase in GDP since 1978. Measured on a purchasing power parity (PPP) basis that adjusts for price differences, China in 2010 stood as the second-largest economy in the world after the US, having surpassed Japan in 2001. The dollar values of China's agricultural and industrial output each exceed those of the US; China is second to the US in the value of services it produces. Still, per capita income is below the world average. The Chinese government faces numerous economic challenges, including: (a) reducing its high domestic savings rate and correspondingly low domestic demand; (b) sustaining adequate job growth for tens of millions of migrants and new entrants to the work force; (c) reducing corruption and other economic crimes; and (d) containing environmental damage and social strife related to the economy's rapid transformation. Economic development has progressed further in coastal provinces than in the interior, and approximately 200 million rural laborers and their dependents have relocated to urban areas to find work. One consequence of the "one child" policy is that China is now one of the most rapidly aging countries in the world. Deterioration in the

environment - notably air pollution, soil erosion, and the steady fall of the water table, especially in the north - is another long-term problem. China continues to lose arable land because of erosion and economic development. The Chinese government is seeking to add energy production capacity from sources other than coal and oil, focusing on nuclear and alternative energy development. In 2009, the global economic downturn reduced foreign demand for Chinese exports for the first time in many years, but China rebounded quickly, outperforming all other major economies in 2010 with GDP growth around 10%. The economy appears set to remain on a strong growth trajectory in 2011, lending credibility to the stimulus policies the regime rolled out during the global financial crisis. The government vows, in the 12th Five-Year Plan adopted in March 2011, to continue reforming the economy and emphasizes the need to increase domestic consumption in order to make the economy less dependent on exports for GDP growth in the future. However, China likely will make only marginal progress toward these rebalancing goals in 2011. Two economic problems China currently faces are inflation - which, late in 2010, surpassed the government's target of 3% - and local government debt, which swelled as a result of stimulus policies, and is largely off-the-books and potentially low-quality. Indias Economic Scenario Innovation and efficiency are the keys to boost the growth of exports from the country, according to Mr M Veerappa Moily, Union Minister for Corporate Affairs. He also suggested that there is a need to develop innovation centres at the district levels to boost exports.

Exports from special economic zones (SEZ) grew by 17 per cent to Rs 260,973 crore (US$ 52.99 billion) during April-December 2011 from Rs 223,132 crore (US$ 45.31 billion) during the corresponding period in the previous year, according to a statement by the Export Promotion Council for Export-oriented Units and SEZs (EPCES) The total amount of foreign direct investment (FDI) equity inflows during April 2011- November 2011 stood at US$ 22,835 million, according to the latest data published by Department of Industrial Policy and Promotion (DIPP) The Government of India has approved 20 proposals of FDI worth Rs 1,935.24 crore (US$ 392.94 million), according to an official statement. The approvals were given, based on the recommendations of the Foreign Investment Promotion Board (FIPB) "India's GDP is expected to grow at 7.7 per cent, which clearly underlines India's potential as an investment destination. The fact that FDI has increased by 31.5

per cent across major sectors further evidences the attractiveness of the Indian economy, as per Gaurav Karnik, Tax Partner, Ernst & Young Foreign exchange reserves stood at US$ 293.383 billion for the week ended February 10, 2012, according to the Reserve Bank of India's (RBI) weekly Statistical Supplement With 56 deals, November 2011 has recorded the maximum number of private equity (PE) investment deals in a month. Real estate, hospitality and construction (RHC) sectors received the highest amount of investments. The investment activity during November 2011 was also significantly higher compared with the corresponding period last year, which was US$ 402 million across 18 deals in November 2010 India Inc raised US$ 1.6 billion through external commercial borrowings (ECBs) in November 2011. Under the automatic route, 78 companies raised US$ 1.3 billion. At present, the Government allows the companies to raise up to US$ 750 million under the automatic route in a year Overseas direct investment by Indian companies has increased at a steady pace in 2011-12, with cumulative investments amounting to US$ 23.81 billion, according to the Reserve Bank of India (RBI) data. Investments by Indian companies in overseas joint ventures (JV)/ wholly-owned subsidiaries (WOS) aggregated US$ 2.74 billion in November 2011