Does Foreign Direct Investment Lead Economic Growth in India?

Saji, T. G.
April 2013
International Journal of Financial Management;2013, Vol. 3 Issue 2, p38
Academic Journal
This paper investigates the causal relations between foreign direct investment and economic growth in a developing country like India. The analysis has been made under Johansen's Cointegration framework based on 21 years of data covering the post reform era of the country. The Cointegration analysis finds strong positive relation between FDI and economic growth in India. The study concludes with a suggestion that the policy makers in India should develop investor friendly environment conducive for attracting more amount of capital from the developed world.


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