Foreign Direct Investment (FDI) is money invested in the business of another country by companies or individuals from one country. Foreign direct investment has a positive impact on the growth of emerging economies. Foreign Direct Investment (FDI) inflows boost a country's worldwide commerce network while also providing financial support, and they are frequently viewed as essential accelerators for economic growth in the host countries. FDI stimulates domestic investment, increases human capital formation, and facilitates technology transfer in host nations, all of which contribute to economic growth. The purpose of this article is to examine the influence of FDI on India's and China's economic growth. Using regression analysis, it was discovered that whereas FDI has a major impact on the growth of the Chinese economy, it has a little or inconsequential impact on the development of the Indian economy for the study period of 1991 to 2020. In comparison to China, India's average FDI as a proportion of GDP is quite low. This is the explanation behind FDI's limited contribution to the Indian economy's growth.

___________________________________________________________________________________

Keywords: FDI, GDP, Economic Growth, Economy, Domestic Investment, Liberalization Process.