A Panel Data Analysis of Locational Determinants of Chinese and Indian Outward Foreign Direct Investment‪.‬

INTRODUCTION The rise of China and India is one of the defining events of the 20th century. While China has captured the world's attention by its phenomenal FDI inflows and impressive GDP growth, India is swiftly developing its offshore IT outsourcing and other service sectors with its language and institutional advantages. The sheer size of the two countries, along with their rapid growth, means that some of the most important impacts are likely yet to be seen. With significant deregulation within the two countries on FDI abroad, those companies that have gained more confidence and accumulated more financial capital are now spreading their wings and investing overseas. Table 1 shows that from 1982 to 1992, Chinese FDI rose from 44 US$ million to 4000 US$ million, while India's outward FDI, beginning at only 1 US$ million in 1982, rose slowly to 24 US$ million in 1992 and then grew steadily from 82 US$ million to 2222 US$ million in 2004.