| Summary/Abstract |
This article argues that bridging institutional distance is a reliable method to increase the flow of Chinese
investments into India. India’s growing economy and ability to attract investments from China meets most
of the conditions that can be considered attractive for investments from China. This is complemented by
China also fulfilling many of the criteria as a source of foreign direct investment (FDI) into India. China
is a major trading partner of India but the Indian economy remains highly deficient in Chinese investment
which undermines reciprocity in economic affairs. The possible reasons for underinvestment by Chinese
enterprises in India are partly associated with the lack of sufficient interactions between institutions of
both the countries, which in turn creates ‘institutional distances’ impacting economic affairs. This article
attempts to throw light on these issues from theoretical and behavioural perspectives. Apart from instances
of ‘institutional differences’, the article will also attempt to address how select ministries in China and
India function while dealing with each other on a case by case basis.
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