
604 | Chapter 21
that the Indian figures count only the fresh inflows of equity and do not take into
consideration the reinvested earnings by foreign aliates in the country nor the
inter-corporate debt flows that are generally included while computing the FDI
figures as per the IMF guidelines. Therefore, the Indian figures tend to under-report
the inflows. Secondly, the FDI inflows into China are believed to be overestimating
the real FDI inflows in view of the round-tripping of the Chinese capital to take
advantage of a more favourable tax treatment of FDI. Therefore, the figures of India
and China are not strictly comparable, and they tend to overplay ...