This index is about transparency, corruption, and accountability. India is transparent, but corrupt. China lacks transparency, but bribery is rare.

In India, you have to pay small (or large) bribes to get anything done. You are faced with a bureaucracy which wants to trip you up with red tape, to force you to pay more bribes. This is not conductive to small business.

China really falls apart when it comes to bigger businesses. State owned enterprises get preferential treatment for all kinds of things, especially funding. And bigger businesses have to follow regulations more carefully.