Impact of Foreign Direct Investment on Sectoral Growth of Indian Economy

International Journal of Economics and Financial Issues, 2017, 7(3), 477-488

12 Pages Posted: 12 Jun 2018

See all articles by Areej Aftab Siddiqui

Areej Aftab Siddiqui

Indian Institute of Foreign Trade; Jamia Millia Islamia (A Central University)

Shahid Ahmed

Jamia Millia Islamia (A Central University) - Economics

Date Written: 2017

Abstract

At the backdrop of expanding economies and in the race of attracting higher investments and enhancing exports, it becomes important to analyze the relationship between Foreign Direct Investment (FDI) and growth in terms of output of the economy. A number of studies have been conducted for analyzing the relationship and impact of FDI on growth of the aggregate economy. This paper aims at assessing the impact and relationship of FDI and Growth with each other at the sectoral level. The impact is examined through Panel co-integration test followed by Random effects model. Granger causality test is also applied to assess the causation of each of these. The results indicate that growth has an impact on FDI but FDI doesn’t have an impact on growth at the sectoral level.

Keywords: Foreign Direct Investment, Growth, Sectors

JEL Classification: F21, O4, I25, I28, C33

Suggested Citation

Siddiqui, Areej Aftab and Ahmed, Shahid, Impact of Foreign Direct Investment on Sectoral Growth of Indian Economy (2017). International Journal of Economics and Financial Issues, 2017, 7(3), 477-488. Available at SSRN: https://ssrn.com/abstract=3165895

Areej Aftab Siddiqui

Indian Institute of Foreign Trade ( email )

New Delhi
New Delhi, 110016
India

Jamia Millia Islamia (A Central University) ( email )

New Dehli
India

Shahid Ahmed (Contact Author)

Jamia Millia Islamia (A Central University) - Economics ( email )

Jamia Nagar
New Delhi, 110025
India

HOME PAGE: http://jmi.ac.in/economics/faculty-members/Prof_Shahid_Ahmed-1783

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