AN EMPIRICAL EXAMINATION OF THE DETERMINANTS OF FOREIGN DIRECT INVESTMENT IN INDIA

Mrs. Sharmila Devi

Abstract


Developingcountries around the world needs huge capital for financing their strategicgoals. Capital in the form of foreign direct investment (FDI) is the mostfavored destination for such countries. This paper examines the macroeconomicvariable that act as determinants of FDI inflow into India.  The potential FDI determinant iscomprehensive, and includes variables proposed from literatures. The authorsmakes use of  time series data for theperiod 2000-01 to 2011-12, and the study employs ordinary Least Square (OLS)method. Order of integrity for all the variables is I (1).  Results indicate that among the selectedvariables, export, index of industrial production, inflation showsstatistically significant at 5 % level. Keywords: Foreign Direct Investment, determinants,Ordinary Lest Square.

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