Determinants of Foreign Direct Investment in India: An Empirical Analysis

Kaur, Manjinder; Dhillon, Sharanjit Singh

doi:10.5958/2249-7307.2017.00142.6

Cited by 12 publications

(22 citation statements)

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“…The other determinants of FDI include the GDP growth rate, macroeconomic stability and domestic investment per capita (Anwar and Nguyen, 2010). The analysis of the determinants of the inflows of FDI in India confirms that foreign exchange reserves, openness, Gross Domestic Product and long-term debt have found to have a positive impact on FDI, while the negative impacts of inflation and exchange rate of FDI have been noticed (Kaur and Sharma, 2013). For the EU countries the analysis of the impact of labor and corporate tax on the decisions FDI stocks within shows that the impact of corporate taxation is well documented, while the role labor taxation plays for FDI is much less studied.…”

Section: Literature Reviewmentioning

confidence: 78%

“…FDI is an important source of development financing, particularly for developing and less developed economies, as it contributes to productivity gains by bringing in new investment, better technology, and management expertise and by opening up export markets (Sahoo et al, 2014). FDI usually represents a long-term commitment to host country and contribute significantly to gross fixed capital formation in developing countries (Kaur and Dhillon, 2017).…”

Section: Introductionmentioning

confidence: 99%

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Determinants of foreign investment in maritime nations

Jouili¹

2018

Int. j. adv. appl. sci.

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This study explores the determinants of foreign direct investment based on panel data analysis. It addresses the relationship of the performance logistics and the shipping connectivity and the foreign direct investment (FDI). This study attempted to fill this gap by estimating the impact of these factors on the FDI, based on World Development Indicators database of 39 developing maritime nations over the period [2007][2008][2009][2010][2011][2012][2013][2014][2015][2016]. The aim of the study is to investigate the relationship between countries' foreign direct investment and their logistics performance, and their shipping connectivity. The study has the originality to introduce tow logistics variables (logistics performance and maritime connectivity) in addition to controlling variables (exchange rate, and gross of domestic product). Empirical results suggest that the shipping connectivity, as well as the logistics performance, could be determinants of foreign direct investment. Concerning control variables result is in line with some study, the coefficient of GDP per capita is positive and significant, while the ORE has a significant negative coefficient.

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Section: Literature Reviewmentioning

confidence: 78%

Section: Introductionmentioning

confidence: 99%

Determinants of foreign investment in maritime nations

Jouili¹

2018

Int. j. adv. appl. sci.

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“…Besides, the study revealed that standard deviation of BSE market returns, US market returns, US market volatility, inflation and exchange rate were found to have negative impacts on FII flows into India. Kaur and Dhillon (2010) explored the determinants of foreign institutional investment in India using monthly data from April 1995 to December 2006. They found that Indian stock market returns have positive impact on FII flows whereas US stock market returns have no significant influence on FII flows to India.…”

Section: Review Of Literaturementioning

confidence: 99%

Determinants of Foreign Institutional Investment in India: An Empirical Analysis

Srinivasan¹,

Kalaivani

2015

Global Business Review

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The purpose of the study is to explore the determinants of foreign institutional investments in India through the Autoregressive Distributed Lag (ARDL) bounds testing approach. Using quarterly time series data, the empirical analysis was carried out for the period from January 2004 to December 2011. Our study result shows that exchange rate has significant negative impact on FII inflows both in the short-run and long-run, implying that depreciation of currency adversely affects the FII flows into India. Moreover, the Indian equity market returns has negative short-run and positive long-run effects on FII inflows to India. This confirms the evidence of positive and negative feedback trading hypothesis in the short-run and long-run, respectively. The US equity market returns has positive and significant influence on FII flows in the long-run but positive and insignificant influence on FII flows in the short-run. The risks associated with US equity market encourage foreign institutional investors to invest more in Indian equity markets. Furthermore, domestic inflation exerts negative and positive significant influence on FII flows in the long-run and short-run, respectively. It can be concluded that FII inflows to India are essentially determined by exchange rate, domestic inflation, domestic equity market returns, returns and risk associated with US equity market.

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“…Still, some of the researchers have shown disagreement about the impact of ER on FDI inflow. Studies by Banga (2003), Ali and Guo (2005), Helldin (2007), Kaur and Sharma (2013) and Asiamah, Ofori, and Afful (2019) have found a negative impact of the ER on FDI inflow. Asiamah et al (2019) have found that the ER has a negative impact on the FDI inflow in Ghana.…”

Section: Review Of Literaturementioning

confidence: 97%

“…The study made by Kumari and Sharma (2017) found that market size, trade openness, inflation and interest rate are the major determinants of FDI inflow in India in the post-1991 period. Studies by Singhania and Gupta (2011) and Kaur and Sharma (2013) have found a positive impact of GDP on FDI in India.…”

Section: Review Of Literaturementioning

confidence: 99%

Dimensions of Foreign Direct Investment Inflow in India After 1991

Nayak

Sahoo

2020

FIIB Business Review

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Foreign Direct Investment (FDI) has emerged as an important topic for researchers and policymakers in India. The present study analyze the dimensions, i.e., current status, global position, trends, growth, sources, sectoral composition, regional distribution, and the determinants of FDI inflow in India after the economic reforms in the year 1991. Furthermore, this piece of research answers an important question, i.e., whether the currency area hypothesis of Aliber (1970) is good enough to explain FDI inflow in India during 1991 – 2018? The study uses trend analysis and simple linear regression analysis to analyze the data. The findings of this research have shed light on some of the important aspects of FDI inflow in India. The inward FDI in India has increased from the US $75 million in 1991 to the US $42285.68 million in 2018, registering an annual average growth rate of 37.85 per cent. This study also finds that the increase in the value of Indian Rupee has an inverse impact on the FDI inflow. Thus, the findings support the currency area hypothesis of Aliber (1970) . It suggests that policymakers should consider the exchange rate while formulating policy to attract FDI inflow into India.

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Determinants of Foreign Direct Investment in India: An Empirical Analysis

Cited by 12 publications

References 0 publications

Determinants of foreign investment in maritime nations

Determinants of foreign investment in maritime nations

Determinants of Foreign Institutional Investment in India: An Empirical Analysis

Dimensions of Foreign Direct Investment Inflow in India After 1991

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