International Journal of Financial Management

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Impact of Foreign Direct Investments on the Gross Domestic Product: A Study on Indian and Chinese Economy


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1 Assistant Professor, Department of Business Administration, Rajagiri College of Social Sciences, Kerala, India
     

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Inflows of world FDI increased tremendously from US $200 billion in 1990 to almost US $ 916 billion in 2005. The BRIC report states that India is going to be one of the most popular destinations for FDI from across the globe. The fundamental question is whether this inflow of FDI would lead to any significant growth in the domestic economy. This study attempts to bring out the relationship between the Gross Domestic Product (GDP) and the Foreign Direct Investments (FDIs). The study concludes that in both the economies FDI are highly positively influential on the GDP, with Chinese economy showing a marginally higher correlation.

Keywords

Foreign Direct Investments (FDIs), Gross Domestic Product (GDP)
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  • Impact of Foreign Direct Investments on the Gross Domestic Product: A Study on Indian and Chinese Economy

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Authors

M. Rakesh Krishnan
Assistant Professor, Department of Business Administration, Rajagiri College of Social Sciences, Kerala, India

Abstract


Inflows of world FDI increased tremendously from US $200 billion in 1990 to almost US $ 916 billion in 2005. The BRIC report states that India is going to be one of the most popular destinations for FDI from across the globe. The fundamental question is whether this inflow of FDI would lead to any significant growth in the domestic economy. This study attempts to bring out the relationship between the Gross Domestic Product (GDP) and the Foreign Direct Investments (FDIs). The study concludes that in both the economies FDI are highly positively influential on the GDP, with Chinese economy showing a marginally higher correlation.

Keywords


Foreign Direct Investments (FDIs), Gross Domestic Product (GDP)

References