Investors should book reservations ahead of President Bushs trip to India since India could very well be the great bull market of the 21st century. Unlike China, it is a functioning democracy with respect for property rights and the rule of law. Many of its citizens have English as their native language. It also has more advanced financial markets than China, and a stock market established in 1870 that has 6,000 publicly-traded companies.

In 1991, the country had zero foreign exchange reserves, now it has $150 billion. In 1991, it had one state-owned airline, now it has eight private airlines. And in 1991, India built and sold only 100,000 automobiles, in 2005 it was a million.

It is a very youthful nation with 80% of its population under 45 and - this is amazing - 25% of all people 25 and under in the world live in this one country! Its Citizens are thrifty with money to spend with a 28% savings rate to support capital investment. Consumer finance is rapidly becoming available and fueling a 30% annual increase in spending with retail sales totaling $200 billion last year. Indias economy has been chugging along in the 7-8% growth range and it is the only large economy expected to grow faster in the next five years than the last five years.

Indias space program has launched 12 consecutive rockets without incident and it put the worlds first graphic mapping satellite into orbit earlier this year. It has become a close ally of the United States recently signing a defense pact and placing a huge order with Boeing while considering purchasing advanced F-16 and F-18 fighters.

And dont forget why President Bush, no big traveler, is headed to India: to cement strong bi-lateral ties in both the security and commercial arena.

For sure India has its challenges: big infrastructure needs, frustrating red tape and a tendency for the government to hang on to large state-owned enterprises to mention a few. Still, compared to China, India does not get much attention except for the outsourcing issue and is for now largely under the radar screen of even many sophisticated investors. Indias 30 company Bombay Sensitive Index (Sensex) index was one of the strongest markets last year and this year broke the 10,000 barrier.

The challenge with investing in India right now is the valuations of the leading companies and the limited investment options. The Morgan Stanley India Fund (IIF) is a closed-end fund that invests in Indias blue chips and is up 74% in the last 12 months and 9% so far this year. It is a bit pricey right now and trades at a 13% premium to net asset value so caution is recommended until this premium comes down to the historical average in the low single digits. There are only eleven Indian ADRs trading on U.S. exchanges and some of these are pricey. One exception may be the generic drug company called Dr. Reddys Lab (RDY NYSE). Dr. Reddy's Laboratories' stock (RDY) climbed recently after the generic-drug maker bought Germany's Betapharm Arzneimittel GmbH. The purchase, the biggest so far by an Indian drug company overseas, will add $200 million to Dr. Reddy's revenue in the next fiscal year.

An aggressive play would be Rediff.com India Ltd. (REDF NASDAQ), an Indian communications company. It operates an Internet portal that provides news, weather, sports, and entertainment information. It also offers an e-commerce marketplace, e-mail, chat rooms, and wireless services. In the last two weeks it has fallen from $31 to $24 on heavy trading volume. Some refer to it as the Google of India so watch this one closely for an entry point.

For many investors, a better alternative is the all weather Matthews India no-load mutual fund (MINDX) which is up 8% this year. Matthews, an Asian specialist, launched this fund last October.

Next month, when the media spotlight turns to the Presidents tour of India, smart investors will be back at home enjoying the returns.