Unlocking BRICS Economies’ Potential: Infrastructure as the Gateway to Enhanced Capital Flows

Sunita Sharma, Shalini Aggarwal, Meena Sharma, Abdallah AlKhawaja () and Suzan Dsouza
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Sunita Sharma: Apex Institute of Management, Chandigarh University, Mohali 140413, India
Shalini Aggarwal: Apex Institute of Management, Chandigarh University, Mohali 140413, India
Meena Sharma: Management Department, Business School, Punjab University, Chandigarh 160014, India
Abdallah AlKhawaja: College of Business Administration, American University of the Middle East, Eqaila 15453, Kuwait
Suzan Dsouza: College of Business Administration, American University of the Middle East, Eqaila 15453, Kuwait

JRFM, 2025, vol. 18, issue 6, 1-33

Abstract: This study investigates the impact of physical and financial infrastructure on the dynamics of net total capital flows in BRICS economies over the period 2010–2024. Using panel data and a fixed-effects regression model with robust standard errors, it analyzes how infrastructure quality, both physical (transport, energy, and telecommunications) and financial (banking systems, capital markets, and regulation), affects private capital inflows. The results show a statistically significant positive relationship, with physical infrastructure reducing business costs and financial infrastructure improving capital allocation and investor confidence. This paper contributes novel empirical evidence linking infrastructure systems with capital flow dynamics, providing key insights for policymakers aiming to enhance resilience and attract sustainable private investment.

Keywords: BRICS economies; private capital flows; physical infrastructure; financial infrastructure; foreign direct investment (FDI); foreign portfolio investment (FPI) (search for similar items in EconPapers)
JEL-codes: C E F2 F3 G (search for similar items in EconPapers)
Date: 2025
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