FDI and Economic Growth in India after Globalization: A Causality Analysis

This study aims at to establish a robust causal direction between foreign direct investment (FDI) and economic growth for India after globalisation. The study explores three possible causal and impact relations; FDI to Growth, Growth to FDI and the bidirectional or no causal link using India's annual Time Series data for GDP and FDI inflows from 1991 to 2006. The study finds that there is a positive relationship between FDI and economic growth. The study also analyses the future scope of this work.