Soft power refers to a nation winning influence abroad by persuasion and appeal rather than by threats or military force. Soft power is a charisma that enables a nation to charm people into doing what it wants others to do. Soft sources of power such as culture, political values, and diplomacy are part of what makes a great power. Success depends not only on whose army wins, but also on whose story wins. China has worked hard to enhance this power, with the Beijing Olympic Games as the climax of its efforts. It is said that as much as $43 billion was spent on sports arenas and social infrastructure, revealing the country�s ambition and drive. China is steadily expanding its cultural, educational and diplomatic influence globally, especially in the developing world. The Chinese have historically had a very well-established network for promoting the influence of culture, education and diplomacy. China is employing its soft power through a broad range of activities in Asia, Africa and Latin America viz. Cultural exchange, sending doctors, engineers, teachers to work abroad, welcoming students from other nations to study in China, promoting Chinese language programmes abroad by establishing Confucius Institutes, culture and language centre around the world, conducting Chinese cultural festivals, greater economic cooperation, making major investments in infrastructure, agriculture and energy etc. China is steadily increasing its soft power and Chinese culture, cuisine, calligraphy, cinema, art, acupuncture, herbal medicine, and fashion are already evident in many parts of the world. Kids wearing Chinese clothes and playing with Chinese toys is becoming very common. China plans to build more than 100 Confucius Institutes worldwide by 2010. China has upgraded its public diplomacy over the years, reinforcing its slogan of peaceful rise. In fact, cultural diplomacy has become an �essential part of China�s overall diplomatic strategy�.Despite many stories of India�s emergence as a rising power, it is believed to be behind China by a decade in many respects. To manage its rise and to make it a developed country, India needs to optimise its impressive soft power resource by paying enough attention to it. India�s values and principles attract as well that constitutes India�s greatest asset in the world of 21st century. India possesses a unique civilization that is assimilating along with its free market democracy, and heterogeneous, pragmatic and open society.  Its needs focus in tapping its soft power potentials which lies in its democratic credentials, secular values, pluralistic society, considerable pool of skilled English speaking professionals, holistic healthcare, culture, classical music, handicrafts, etc. Soft power would be vital for translating India�s ambitions into reality.