IDEAS home Printed from https://ideas.repec.org/p/pra/mprapa/17078.html
   My bibliography  Save this paper

Rise of service sector outward foreign direct investment from Indian economy: trends, patterns, and determinants

Author

Listed:
  • Pradhan, Jaya Prakash

Abstract

The rise of service sector outward FDI (OFDI) activities has emerged as one of the most important aspects of Indian economy during nineties. The present paper reviews the recent trends and patterns and tries to identify determinants of such investment. As compared to the eighties, the character of service sector OFDI flows has gone through several transformations. In the seventies it is largely a phenomenon led by firms from hotels & restaurants, finance and marketing segments and is being directed at developing regions in overwhelming cases and is mostly minority owned. In contrast, during nineties it is predominantly led by the software segment of the service sector, locationally developed country oriented and is largely majority-owned ventures. The rising trends in the service sector Investment Development Path (IDP) of Indian economy has been found to be related to the stylized aspect of economic growth expressed in terms of structural shift in economic activities. At the firm level the OFDI behavior of service sector firms is observed to be non-linearly related to the firm age and size, both relationships following inverted U-shape curves. Firm’s innovation, export orientation and profitability are also found to be important explanators in the rise of OFDI at the firm level. The import of capital goods however appears to have a negative impact on trans-border expansion of service sector firms.

Suggested Citation

  • Pradhan, Jaya Prakash, 2003. "Rise of service sector outward foreign direct investment from Indian economy: trends, patterns, and determinants," MPRA Paper 17078, University Library of Munich, Germany.
    • Handle: RePEc:pra:mprapa:17078
    as

    Download full text from publisher

    File URL: https://mpra.ub.uni-muenchen.de/17078/2/MPRA_paper_17078.pdf
    File Function: original version
    Download Restriction: no

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Sanjay Kumar & Nupur Chowdhury, 2005. "Trade and Environment in the WTO : Negotiating Options for Developing Countries," Macroeconomics Working Papers 22106, East Asian Bureau of Economic Research.
    2. S. K. Mohanty & Sachin Chaturvedi, 2005. "Prospects for Environmental Trade under the Regional Process in South Asia : Evidence from SAPTA and Proposals for SAFTA," Trade Working Papers 22119, East Asian Bureau of Economic Research.
    3. Pradhan, Jaya Prakash, 2005. "Outward Foreign Direct Investment from India: Recent Trends and Patterns," MPRA Paper 12358, University Library of Munich, Germany.
    4. S. K. Mohanty & Sachin Chaturvedi, 2005. "Emergence of China and India in the New Millennium : Will it Facilitate Market Access for LDCs and Developing Countries?," Trade Working Papers 22120, East Asian Bureau of Economic Research.
    5. Yilmaz Akyüz, 2005. "The WTO Negotiations on Industrial Tariffs : What is at Stake for Developing Countries?," Trade Working Papers 22080, East Asian Bureau of Economic Research.
    6. K.J. Joseph, 2005. "Strategic Approach to Strengthening the International Competitiveness in Knowledge Based Industries : Electronics Industry," Microeconomics Working Papers 22102, East Asian Bureau of Economic Research.
    7. Sachin Chaturvedi & Lian Chawii, 2005. "Biosafety Protocol, International Trade and Agricultural Biotechnology : Policy Inferences for India," Trade Working Papers 22086, East Asian Bureau of Economic Research.
    8. Nagesh Kumar, 2005. "Towards a Broader Asian Community : Agenda for the East Asia Summit," Macroeconomics Working Papers 22107, East Asian Bureau of Economic Research.
    9. Mukul G. Asher & Amarendu Nandy, 2006. "Demographic Complementarities and Outsourcing : Implications and Challenges for India," Macroeconomics Working Papers 22082, East Asian Bureau of Economic Research.
    10. Mirajul Haq & Syed Kafait Hussain Naqvi & Muhammad Luqman, 2016. "Is the Value Addition in Services and Manufacturing Complementary? Empirical Evidence from SAARC," Lahore Journal of Economics, Department of Economics, The Lahore School of Economics, vol. 21(2), pages 31-52, July-Dec.
    11. Ramkishen S. Rajan, 2006. "Monetary and Financial Cooperation in Asia : Emerging Trends and Prospects," Finance Working Papers 22125, East Asian Bureau of Economic Research.

    More about this item

    Keywords

    Service Sector; Outward FDI;

    JEL classification:

    • F23 - International Economics - - International Factor Movements and International Business - - - Multinational Firms; International Business
    • L8 - Industrial Organization - - Industry Studies: Services
    • F21 - International Economics - - International Factor Movements and International Business - - - International Investment; Long-Term Capital Movements

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:pra:mprapa:17078. 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: (Joachim Winter) or (Rebekah McClure). General contact details of provider: http://edirc.repec.org/data/vfmunde.html .

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    We have no references for this item. You can help adding them by using this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service hosted by the Research Division of the Federal Reserve Bank of St. Louis . RePEc uses bibliographic data supplied by the respective publishers.