Indeed, the suspicion is that China's economy is no longer able to absorb much foreign capital.

ECONOMIST: China��s private surprise

At this rate, India can absorb foreign capital and put it to productive use, unlike some of the Southeast Asian economies.

CNN: Booking a Passage to India

One reason China is setting up its sovereign wealth fund now is that huge trade surpluses and a vast reserve of foreign exchange mean it simply has too much cash to absorb into its own economy, and capital controls keep it from investing in liquid assets like American T-bills.

FORBES: Tracking The Sovereign Funds