RELATIONSHIP BETWEEN FDI DISTRIBUTION AND REGIONAL ECONOMIC AGGREGATES: AN EVIDENCE FROM INDIA

Tushar Ranjan Panigrahi () and Sunita Mall ()
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Tushar Ranjan Panigrahi: St. Fransis Institute of Management studies, Mumbai, India
Sunita Mall: MICA, Ahmedabad, India

Romanian Economic Business Review, 2017, vol. 12, issue 4, 109-124

Abstract: India is a rapidly developing country with diversified culture, language, economic status and resource distribution. Foreign Direct investment(FDI) brings employment opportunities, generate more income, lead to urbanization in the region. FDI has a growth impact on the targeted region. In India the problem of regional imbalances is very prominent and regional economic disparity is a major concern. This research paper made an attempt to check if the FDI inflow to the regions are significantly dependent on socio economic variables. The association between the variables is studied using Karl Pearson correlation analysis. The impact of regional socio economic factors on FDI inflow to the regions is also investigated in this paper using regression analysis. The data is collected for the time period of January 2000 to December 2016 from department of industrial planning and promotions, ministry of commerce and industries, Govt. of India, Ministry of economic affairs etc. The variables like income from agriculture, income from industry, per capita NSDP, population density, HDI, per capita GSDP, state GDP, annual wage per worker are found to have significant impact on FDI inflow to the regions and are in line with the existing literature. This piece of research can help the government, policymakers and analysts to introduce the policies that can attract more FDI to several regions ensuring India’s economic growth.

Keywords: Regional economic aggregates; Foreign direct investment; Net state domestic product; gross state domestic product; population density (search for similar items in EconPapers)
Date: 2017
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