Export and Economic Growth in India

The present paper examines the causal nexus between export and economic growth in India for the year 1950-51 to 1993-94. Co-integration technique has been employed to pursue the objective. The empirical results revealed the existence of a bi-directional causal relation between export and economic growth in India. This may be attributed to the fact that export promotion measures in India allocate resources efficiently according to comparative advantage causing economic growth, which interacts with a scenario where external economies associated with economic growth. However, the results derived from the analysis of co-integration technique is limited to the extent of existence of structural break and bias in a small sample.