Factors influencing foreign direct investments: Indian evidence

Neha Shrivastava, Peeyush Bangur and Deepak Shrivastava

International Journal of Economics and Accounting, 2022, vol. 11, issue 3, 233-243

Abstract: Foreign direct investments have become vital for the economic growth of developing countries. This paper aims to understand and evaluate the factors that influence FDI inflow in India. A regression model has carried out an evocative analysis to assess the impact of macroeconomic factors on the inflow of FDI in the Indian economy. Further, we have discussed the corrective measures and effective strategies to establish the smooth inflow of FDI. The study discovered the extensive requirement of FII and FDI in the Indian economy. Also, there is a sincere necessity for currency stability. The variables - international trade and REER showed a positive relationship with FDI inflow. Therefore, the government needs to extend its assistance to strengthen exports and manufacturing industries. It can be done by proper allocation of FDI and FII. Moreover, it will help the domestic industries to maintain the long-term benefits.

Keywords: foreign direct investments; FDI; FII; inflation; economic growth; government policies; exchange rate; GDP. (search for similar items in EconPapers)
Date: 2022
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Persistent link: https://EconPapers.repec.org/RePEc:ids:ijecac:v:11:y:2022:i:3:p:233-243

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