"Indian government runs larger fiscal deficits and has accumulated more debt as a share of gross domestic products than its Chinese counterpart. India is unlikely to follow the path of East Asian tigers, such as Korea, Taiwan or even China in attaining very rapid growth rates over a prolonged period of time," S&P said in a report.

"It may follow the path of Thailand or Italy, which experienced good economic growth and falling poverty thanks to a dynamic private sector, despite many years of squabbling coalition governments," it said in the report titled 'China, India and the Fate of Globalisation'.

"Or, it may follow the path of Brazil, a large country with an impressive private sector...," it said. In contrast, China may follow the path of Taiwan and Korea, which have grown rapidly under authoritarian governments, S&P said.

S&P assigned 'BBB+' investment-grade long-term foreign currency rating and positive outlook to China, compared with a 'BB' speculative-grade long-term foreign currency rating and positive outlook assigned to India.

The gap in the ratings is largely explained by China's stronger fiscal position and lower debt burden.