This might help to make your mind:
Wagon R (1.0) is fuel efficient compared to V2 (1.3)
Wagon R having good resale value (although showroom price is too high compare to features provided)
Wagon R is better for within city use due to fuel economy, resale, and parts and mechanic availability.
FAW V2 is better in case you want to have long drives (more safety features and road grip).
Conclusion:
Buying a new car in the limited budget came up with limited choices(currently Wagon R and Faw V2 are only the two fits best), but in case you have some trusted person/mechanic who can help you to buy 2nd hand cars then go for Japenese car.