FDI Outflows from India: An Examination of the underlying Economics, Policies and their Impact
This paper discusses the trends in India's outward FDI over the last decade and then attempts to identify the driving factors for the same. The aim is to provide policy makers with insights regarding levers which would help in encouraging FDI outflows and to stimulate further research in foreign investment from emerging economies. The analysis is based on 287 instances of foreign investment from India by top Indian companies across 17 sectors. The paper draws on the "eclectic" paradigm to study the impact of ownership, location and internalization variables on India's foreign investment. A sector wise analysis of mode of entry, intent of entry and geographic concentration has been performed. At an aggregate level, it has been found that acquisitions have been the predominant mode of entry for Indian firms investing abroad and seeking new markets the primary intent of investment. A regression model was also developed to understand the impact and relative importance of owndership variables such as distribution system, need for resources, factor of production, post sales service requirement, presence of IP and brand on foreign investment from India. It was found that high distribution expenses and need for resources had a very positive influence on foreign investment. The paper also discusses the key policy changes that impacted outward FDI from India in the last decade and relationship of outward FDI with other macroeconomic indicators such as GDP and Fischer Open Differential.
|Date of creation:|
|Contact details of provider:|| Phone: 91 79 2630 7241|
Fax: 91 79 2630 6896
Web page: https://web.iima.ac.in/publications
More information through EDIRC
References listed on IDEAS
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Dunning, John H & Rugman, Alan M, 1985. "The Influence of Hymer's Dissertation on the Theory of Foreign Direct Investment," American Economic Review, American Economic Association, vol. 75(2), pages 228-232, May.
- John H Dunning, 1988. "The Eclectic Paradigm of International Production: A Restatement and Some Possible Extensions," Journal of International Business Studies, Palgrave Macmillan;Academy of International Business, vol. 19(1), pages 1-31, March.
When requesting a correction, please mention this item's handle: RePEc:iim:iimawp:9862. See general information about how to correct material in RePEc.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: ()
If references are entirely missing, you can add them using this form.